BoE's Bailey 'blocked' Reeves meeting with Revolut over licence - report

(Sharecast News) - Bank of England Governor Andrew Bailey reportedly stepped in to block a meeting that Finance Minister Rachel Reeves tried to secure between financial watchdogs and Revolut over the fintech's banking licence.

Reeves, who is pushing for Revolut to be fully approved as quickly as possible, tried to set up a three-way meeting with Treasury officials alongside the company and the BoE's Prudential Regulation Authority, the Financial Times reported citing unnamed people familiar with the matter.

Revolut's application for a banking licence was approved last year, but it is still yet to be fully authorised. The meeting was cancelled after Bailey intervened amid concerns that the bank's regulation should be independent from political interventions.

Tensions have arisen in recent weeks as Reeves pushes for a more deregulated financial services industry in her desperate quest to grow the economy. Bailey last week publicly signalled his frustration with her demands to ease up on rules governing the City.

"We can't compromise on basic financial stability." Bailey told MPs on the cross-party Treasury committee. He was also said to be irritated by Reeves Mansion House speech this month in which she said some regulation was acting as "a boot on the neck of business".

It took Revolut three years to get a UK banking licence after lengthy wrangling with regulators. The process was complicated by Revolut's size: the company has nearly 11 million customers in the UK and more than 50 million worldwide.

Government ministers are also desperate to convince Revolut - last estimated to be worth $45bn - to choose London for its long-awaited stock market listing.

Comments from Revolut co-founder and chief executive Nik Storonsky, who suggested last December that New York could be a better fit because of the regulatory environment and the size of the market, have also sparked concerns.

Reeves has seized several opportunities to push regulators to take a more growth-friendly approach, including promising to overhaul the Financial Ombudsman Service that banks have criticised for being too generous to consumers.

She also sought to intervene in this year's Supreme Court case over whether banks should pay billions of pounds in redress over car loans. The court rejected Reeves' request, but she is considering legislation to shield the banks from the cost if the judgment due on Friday goes against them.

Reporting by Frank Prenesti for Sharecast.com