UK financial watchdog 'to launch banks inquiry'

The City watchdog in the UK is to hold an investigation into the events which led to the British government’s rescue of HBOS and Royal Bank of Scotland, it was reported today.

The inquiry by the Financial Services Authority (FSA) is expected to examine a range of issues, including the banks’ risk management processes and the conduct of directors prior to the first wave of bail-outs, the Sunday Telegraph newspaper said.