Day in the Life: Howard Davies, head of the FSA
0650 Wake up at home in Shepherds Bush in London. Try to activate 14-year-old (difficult), dog (more difficult) and 17-year old (impossible). Have a cup of tea, read the sports pages.
0745 Leave by car for office at Canary Wharf. Read the FT, and my papers for the day, on the way.
0830 Arrive in Canary Wharf for a cappucino and a white chocolate and strawberry muffin at Starbucks. The muffins were discontinued for a while, but a letter from FSA staff got them reinstated. Financial markets are safer as a result.
0900 Brief senior staff - the top 60 or so - on decisions made that week, what the Board has decided, what the Directors Committee has been up to. With 2,200 staff, regulating 11,000 firms, internal communications are quite a challenge.
1000 Courtesy call by the chairman of a large Japanese bank, with an operation in London.
Given the parlous state of the Japanese economy, it is not surprising that some of their banks are in trouble. Their share of the London market has fallen from 24% a decade ago to 5% today, and the number of banks here has dropped from 27 to nine. Even those nine are not all in good shape.
So our staff visit Japan frequently. I spent a few days there in April, meeting the Japanese FSA, our opposite numbers.
1100 Chair our Firms and Markets Committee, in which we discuss all the cases we have underway, and all the doubtful things going on in the City. We usually have somewhere around 300 active investigations under way at any one time, and also firms which are, one way or another, in some difficulty.
Perhaps their strategies are leading them astray, perhaps they simply aren't making enough money, perhaps there is something nasty in the woodshed. We review our response to all these cases, and what we can say about them in the press. We get hundreds of calls a week from newspapers.
1200 A meeting on the global review of bank capital, carried out by the Basel Committee of Banking Supervisors, of which we are a member. We are trying to find a better way of deciding just how large banks' capital reserves should be. The last overhaul was at the end of the 80s, and since then banking has become far more complicated, and more risky. This is the most intellectually difficult, pointy-headed aspect of our work.
1330 A press interview. One of the hazards of the job is that newspapers never tire of publishing profiles of the FSA in general, or me in particular. Some of the journalists arrive well prepared, with good questions. In other cases you have to wonder if they know which building they are in.
1430 Lunchtime seems to have disappeared, which is very frequently the case, and I segue into a meeting of our Chairman's Committee. The five of us run the FSA as far as possible as a collective. On the big decisions I am convinced that five heads are better than one. We go through the big policy challenges, staffing issues and the state of our 200 million budget.
We are funded entirely by fees from the financial industry, and have to make sure that we come very close to breakeven every year. It is a delicate balancing act, since you never know where you are going to have to throw resource when you start the year.
1700 My regular meeting with the governor at the Bank of England. We have worked alongside each other for most of the last 20 years, so it is an easy relationship. We talk about the state of the global financial system. Is the US economy recovering? How does the euro look? Can we see any signs of strain in our markets that might influence either monetary policy (on his side) or financial regulation (on mine)?
1830 I take a few calls in the car on the way to Waterloo, to catch the Eurostar to Brussels. I meet a couple of colleagues on the train. We are running a European project looking at how we should regulate alternative trading systems in the future. ATSs are mechanisms for dealing in shares outside the normal Stock Exchange framework.
They are cheap and convenient for investors, but how can we be sure that the prices quoted are fair and reasonable?
My two female colleagues have been supporting me in this work for the last year. One is German, the other French, but they are both permanent FSA employees. As the regulator of an international financial centre, we think we need an international staff, and we are recruiting increasingly from Continental Europe, as well as the English-speaking world that has long been a source of good people for us.
0000 The train is late, after crawling through Kent on our exciting high-speed network. So I reach our Brussels hotel at midnight (their time) to find half an inch of faxes from my office, detailing some thrilling new proposals from the European Commission.
When I have made sense of them and phoned back my reactions on the voicemail, I tuck-up, dreaming happily of my breakfast meeting the next day with our diplomats in Brussels. There must be an easier way to make a living, but I haven't been offered one recently.
