Annual Report and Annual Public Meeting
We have published our Annual Report and Accounts 2021/22. They set out our work over the last year to meet our objectives of protecting consumers, enhancing market integrity and promoting competition, while becoming a more innovative, assertive and adaptive regulator.
We will discuss this work at our virtual annual public meeting on 15 September 2022. There will be an opportunity for questions to the Chair, Chief Executive and executive directors of the FCA. Visit our registration site to register and to submit your questions.
Margin requirements for uncleared derivatives
We have published a joint Consultation Paper with the PRA with proposals to amend certain onshored Technical Standards for margin requirement for non-centrally cleared derivatives. The proposals aim to address issues previously raised by industry, while maintaining strong margin requirements for non-centrally cleared derivatives.
The PRA and FCA invite responses on the proposals set out in this consultation. PRA-regulated firms should address any comments or questions to CP11_22@bankofengland.co.uk. FCA solo-regulated firms should address any comments or enquiries to cp22-13@fca.org.uk. Other respondents should submit responses to both authorities.
We welcome feedback by 12 October 2022.
Publication of our first climate related financial disclosure report
We have published our first climate-related disclosure report alongside our Annual Report and Accounts. We want to promote transparency and role-model good reporting for the listed companies and financial firms within scope of our climate-related financial disclosure rules.
Our report is aligned with the recommendations of the Taskforce on Climate-related Financial Disclosures. It sets out our approach to climate risks and opportunities under four pillars: Governance, Strategy Risk Management and Metrics and Targets, and is part of our wider ESG work.
Product Governance multi-firm review
We have conducted a multi-firm review to assess whether manufacturers of general insurance and pure protection products are undertaking the necessary work to comply with PROD 4 of the FCA Handbook.
We will email a letter to all firms with general insurance permissions, and those that manufacture or distribute pure protection products by the end of July 2022. This letter will explain our findings along with the actions we expect firms to take.
If your firm manufactures or distributes general insurance and/or pure protection products, and you have not received the letter by the end of July, please contact the FCA at firm.queries@fca.org.uk.
FCA approach to compromises for regulated firms
We have issued guidance on our approach to schemes of arrangement and other compromises for regulated firms (FG22/4).
The new guidance aims to help regulated firms and their advisers understand the FCA’s role, the information that firms need to provide to us and the factors we’ll consider when assessing compromises and deciding if and what actions to take.
The guidance is targeted at firms that are solely regulated by the FCA and firms that are dual regulated by the FCA and PRA for conduct. It is also relevant to advisers of regulated firms considering compromises (including insolvency practitioners and professional advisers) and consumers.
Changes to Firm Reference Numbers (FRN) and Product Reference Numbers (PRNs)
We use 6-digit Firm Reference Numbers (FRNs) to uniquely identify firms, and 6-digit Product Reference Numbers (PRNs) to identify funds. We’re likely to reach the 6-digit limit (999999) during 2023, given the volume of applications and notifications we receive.
We’re planning a move to 7-digit FRNs and PRNs for newly registered firms and funds. Firms previously allocated a 6-digit FRN or PRN will keep that number. We’ll start allocating 7-digit numbers once we used our entire 6-digit range is exhausted.
We haven’t yet fixed a date for this, but we’re on track to make the necessary changes to our internal systems in good time.
Research into borrowers in financial difficulty
It covers borrowers’ experiences of contacting their lenders and the common barriers they face in engaging with their lenders and getting debt advice. The report will be useful to help firms’ with their practices when dealing with borrowers in financial difficulty.
We shared some of the findings in a press release we published earlier this month urging consumers to seek help if they are struggling due to the rising cost of living.
Treatment of struggling small business borrowers
As part of our response to the increased cost of living, we’ve written to banks telling them to improve their treatment of struggling small business borrowers.
Our multi-firm work into collection and recoveries practices for SME customers identified ways the whole sector needs to improve. These include having effective policies in place to make sure customers are treated fairly and making sure staff receive the right training to support customers.
We expect banks to make sure they are meeting our expectations and to tell us if they can’t do this. We will take action if problems continue.
Multi-firm work on financial claims
We have been investigating whether, post-PPI, some claims management companies (CMCs) are moving into new claims areas without the necessary expertise.
Our review, which focused on several firms operating in complex areas like investments claims, found none had moved into new areas, while 2 had stopped taking on new claims altogether.
Disclosure Requirements for EEA UCITS
The Treasury recently extended the Undertakings for Collective Investment in Transferable Securities (UCITS) exemption from the PRIIPs regime until December 2026. We have clarified that EEA UCITS should continue to provide UK retail investors with the Key Investor Information Document while this exemption is in place. Find out more here.
Protecting investors in authorised funds following the Russian invasion of Ukraine
We have published final Handbook rules to address the potential harm caused by the exposure that UK authorised retail funds have to affected investments. So that these funds can operate fairly and efficiently in the interests of all investors, the rules allow these funds to use ‘side pockets’ where their Russian, Belarusian and Ukrainian exposures are subject to financial sanctions, or cannot be valued or traded.
The policy statement setting out the final rules and guidance can be found here.
FCA leadership team appointments
On 5 July, we announced the appointments of six directors. We’ve expanded our headcount to meet a growing remit and to achieve our strategy, which we launched in April.
The appointments will fill a mix of new and existing roles and draw on our internal talent and external expertise.
We’ve added to the almost 500 new colleagues we successfully recruited between January and the end of July this year.
Updating the FCA website
Over the coming months you will see some changes to our website as we review and refresh our content and design. This has started with an updated FCA homepage and about us section.
We want to make the website easier to navigate to help you find information. We are also reviewing the content to make it as clear and accessible as possible.
Sign-up if you would like to participate in future user testing or contact our website team if you have any questions via webmaster@fca.org.uk.
Loan fee fraud partnerships campaign
We will be launching a loan fee fraud partnerships campaign on 1 August – 5 September 2022 in response to the rising cost of living which has created increased vulnerabilities in the consumer credit space.
The partnerships campaign aims to educate and raise awareness of loan fee fraud amongst consumers, employers and member organisations. This is to encourage them to check if a loan provider is authorised before taking out a loan and how best they can protect themselves against loan fee fraud. We have a developed a partnership toolkit which features, social media assets, social media copy, A4 poster and a staff briefing document.
The social assets will be shared on our FCA owned channels (Twitter and ScamSmart Facebook) and supported by paid search activity.
Insight: Interest rates and risk-based credit limits in the UK credit card market
William Matcham of the London School of Economics and Political Science and FCA economist Jonathan Shaw use the FCA's 2015 Credit Card Market Study dataset to investigate how UK lenders base choices on customers' risk.
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