The Financial Conduct Authority (FCA) has shelved plans for an inquiry into the culture, practices and pay of staff in banking.
The inquiry had planned to investigate whether financial incentives such as pay or promotions had contributed to the mismanagement that bought the world's economy to its knees in 2008.
The FCA said it had concluded that a "traditional thematic review” was insufficient to achieve “desired outcomes” and would instead encourage a "delivery of cultural change”, while a Banking Standards Board has since been set up to look at banks individually, rather than as an industry.
An FCA spokesperson said:
We have decided that the best way to support these efforts is to engage individually with firms to encourage their delivery of cultural change as well as supporting the other initiatives outside the FCA.
Labour MP John Mann told the Independent that he feared the decision was linked to the sacking of former chief executive of the FCA, Martin Wheatley, in July.
This relates directly to the sacking of Wheatley and the opportunity this has given Osborne to pull the dogs off the banks.
Liberal Democrat leader Tim Farron said any hope of change in culture in the financial services had been "dashed".
The FCA stated that a "focus on the culture in financial services firms remains a priority".