Meet Reeves’ outsider tasked with steering the City to growth
The City has rolled out the red carpet for the banking watchdog’s new chief after Katharine Braddick, a seasoned veteran of the financial trenches, was named on Friday as the successor to Sam Woods. For a cool £314,000 a year, she’s set to take on the brief of steering the UK’s banking sector.
Chancellor Rachel Reeves, who led the recruitment campaign, labelled Braddick an “accomplished pro-business leader” who backs “lending that drives growth”.
It was that final word that likely sealed the deal for the new boss of the Prudential Regulation Authority (PRA).
Reeves has consistently touted financial services as the “heart” of her economic mission, even as that mission has been derailed by several weak GDP prints of late.
To get the gears turning, regulators have been in the firing line. The chair of the UK’s competition watchdog, Marcus Bokkerink, was ousted by the government in January 2025 for being insufficiently enthusiastic about the government’s growth agenda. Not long after, the Payment Systems Regulator was axed entirely – with much of it folded into the Financial Conduct Authority – as part of Reeves’ wider war on “red tape.”
Though she has faced some stubbornness in the Bank of England, which the PRA sits within, with governor Andrew Bailey defending regulation’s role in the economy and pushing back against the idea that all red tape strangles growth.
Faced with a central bank that seemed less than enthusiastic about loosening its reins, Reeves embarked on a pursuit for an outsider with City sensibilities to steer the ship.
Enter Katherine Braddick, whose appointment was branded by RBC analyst Benjamin Toms as the “first time since the financial crisis that a bank-friendly appointment has been made by the regulator”.
City hails the outsider
Braddick takes the helm at the PRA with experience across the public and private sector. Most recently, she served a four-year stint as head of strategic policy at Barclays, which followed a near eight-year tenure at the Treasury, in which she became one of the department’s top civil servants.
During her time at HMT, Braddick is understood to have played a central role in brokering a deal for the City as ministers explored routes for maintaining access for British financial services in the EU following Brexit.
Reports from Sky News suggested Braddick was set for a head-to-head with PRA incumbent David Bailey – a man who in 2021 said the watchdog had “absolutely no intention of weakening prudential regulation in the UK”.
Industry bodies and City institutions welcomed Braddick’s appointment. Chris Hayward, policy chair at Canada Corporation said he could “think of no one better” for the job and the London Market Group described the nomination as a “very welcoming sign”.
One City banking chief told Morning Wire that Braddick was their “preferred pick,” stressing the value of her background across the public and private sectors.
Another senior City source said her range of experience should be “essential” for candidates, though added Braddick would likely have her plate full with trying to speed up the “slow” rate of deregulation.
Braddick tasked with deregulatory agenda
Reeves unveiled her ‘Leeds Reforms’ last year with a package she said would “rewire” financial services, but analysts warned the changes were “unlikely to be transformative”.
At the top of Braddick’s in-tray will be two sticky issues the City continues to battle against. First up is the internating-ratings based system (IRB), which historically has disadvantaged challengers through forcing them to hold more risk weight on the same loan compared with larger banks.
And second is the historic ring-fencing regime. Ring-fencing requires major banks to separate their retail banking operations from their investment banking activities. It was introduced in the wake of the financial crisis to ensure stability and was mandated in the Financial Services Act 2013.
Top bank chiefs from HSBC, Lloyds, Natwest and Santander have lobbied Reeves’ to rip up the “redundant” regime in the last year – though one notable name broke from the peers.
Barclays boss CS Venkatkrishnan – known in the industry as Venkat – launched a staunch defence of the system, arguing in favour of the “immense amount of depositor protection that the ring-fencing regime gives the country”.
As part of her career, Braddick served as an adviser to Venkat.
“I don’t expect Braddick will pursue an abolitionist agenda in the context of ring fencing,” said John Cronin, banking analyst at Seapoint Insights.
He did add despite her status as a Barclays alum, he would be “highly surprised if she doesn’t press for reforms”.
Cronin said deregulation was expected to be on the agenda ongoing forward, but offered a warning that any suggestion Braddick “will just dance to the government’s tune is misplaced”.