The Chancellor, George Osborne, has ordered an independent investigation into the events surrounding the Co-operative Bank.

He will use the powers brought in under the Financial Services Act 2012 to order an independent investigation says a Treasury statement.

The regulators (Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA)) have agreed that there is a public interest in a statutory investigation into the matter and will appoint an independent person to lead the enquiry.

Both the FCA and PRA are considering starting formal enforcement investigations, which means that any enquiry will not start "…until it is clear it will not prejudice any actions the relevant authorities may take, including the potential FCA and PRA enforcement investigations". Said the Treasury.

A statement from the PRA said:

"The Prudential Regulation Authority welcomes HM Treasury's announcement that an investigation will take place into the affairs of the Co-operative Bank and the actions of all relevant authorities. This investigation will take place under section 77 of the Financial Services Act 2012.

Co-operative bank by David Wright

Co-operative bank by David Wright

"The Prudential Regulation Authority fully agrees that the investigation should be led by an independent person, and looks forward to supporting them in their work. The Prudential Regulation Authority will make its full resources available to support the investigation.

"The timing of the investigation must not prejudice any other criminal or regulatory proceedings. The Prudential Regulation Authority is already undertaking work to establish whether it should commence a formal enforcement investigation and expects to reach a conclusion shortly."

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