In HK, there are three main financial services regulators, one for the banks (the HKMA), one for securities (the SFC) and one for insurance. The bifurcation that exists between the HKMA and the SFC in relation to securities has been criticised in relation to the Lehman mini bond scandal. But conversely the splitting of regulatory responsibilities did not result in many of the other problems we saw in other markets during the crisis last year. Broadly the HK regulatory system stood up well. No major banks failed, no major brokers went down, no emergency rules (like the short selling rules) were needed.

In Singapore they have one primary regulator, the MAS. The MAS has many roles from protection of the currency and national treasure to regulating banks to regulating securities firms and transactions and protecting the public. It also made mistakes in relation to the regulation of structured products like HK did with its two regulators involved. The MAS is now becoming quite a difficult animal to deal with in day to day interactions. Is this because it has some functions which are of vital national interest and others that are actually rather mundane, and it is having trouble allowing the mundane stuff to get through a system designed to protect the vital bits?

Personally I don't think one regulator is the solution to anything. The solution is better regulation. Protect those that need the government's protection, back off from the professionals who enter at their own risk, supervise those carefully that are at the core of our financial system, prosecute those that abuse it.

Taxes and regulation do not mix. Leave taxes to the politicians and regulation to the regulators. Mixing them will only create more distortions and abuse.