View more on these topics

FSA releases Practitioner Panel report

The Financial Services Authority said yesterday that an independent survey of industry views about the financial services regulatory regime provides a valuable insight which will help the FSA as it continues to develop the system of financial regulation.

FSA Chairman Howard Davies says: “The FSA was officially launched at a time when the profitability of individual firms was under pressure. Against that background, it is not surprising that the costs of regulation are particularly under the spotlight. We will use the findings in this report to help us make our regime more cost-effective in the future.”

The FSA notes many positive aspects of the Practitioner Panel&#39s report such as:

• By a margin of almost three to one, chief executives of the larger firms believe strongly the new regulatory regime has been either very or fairly beneficial. This opinion is reflected within the other two groups surveyed – heads of compliance and smaller organisations.

• The report shows continued support for strong regulation. The FSA is seen to be taking a firm line with businesses which break the rules.

• The FSA is also seen to be listening to consumer views when deciding its policies. On balance, firms believe that regulation has been good for the consumer.

The FSA also notes that firms of all sizes believe there have been too many regulatory reviews of the financial services industry, and also that if there are to be more in future these should be conducted by the FSA rather than by a government department.

The Practitioner Panel identifies three areas of concern about the FSA&#39s performance – individual guidance, accessibility of the Handbook and the costs of regulation:

• It was to be expected that in the early days of the new regime the demand for guidance and rule waivers would be particularly strong. We accept that we have not fully met expectations in this area. We now have a business improvement programme designed, among other things, to streamline our processes for giving guidance to firms;

•The FSA agrees that its Handbook is substantial and accepts that some firms have found it difficult to navigate. The FSA has already developed a Specialist Sourcebook for credit unions and is preparing further such Sourcebooks for the new mortgage and general insurance regimes. In other areas we have developed Specialist Guides, signposting those elements of the Handbook which apply to particular market sectors, for example oil market participants. In the next few months we shall be launching an improved version of the Handbook on our website which will be easier to navigate and will provide the platform for further improvements in its ease-of-use during 2003;

• We are concerned at the evidence in the Report that the costs of regulation have gone up.

In our experience there appears to be little direct relationship between the amount of money which firms spend on compliance and the resulting outcomes – some firms deliver effective compliance on a modest budget, whilst others spend considerable sums on compliance, but with unsatisfactory results. So we are commissioning a pilot research project to consider this question further and to help us understanding these diverging patterns of expenditure and outcome.


Mortgage intermediaries welcome Trigold

The Mortgage Alliance (TMA), the Scottish Mutual and Scottish Provident mortgage club, has launched a customised version of Trigold. Currently 3000 members benefit from the services of TMA, which processes mortgages to the value of £250 million each month. Mark Evans, national mortgage manager at TMA, says that, with tighter mortgage regulations on the horizon, […]

Kensington signs deal with TMPC

Kensington Mortgages has signed a distribution and packaging deal with The Mortgage Placement Company.Brokers can access the full Kensington product range under the new arrangement, which the lender expects will pull in “significant” volumes of business.TMPC already has a branded lending relationship with Mortgages PLC, whose products overlap some of the Kensington range. But both […]

Optoma launches online trading platform

Processing company Optoma Broker Solutions expects to triple turnover with the launch of a fully compliant online application system.The system was developed in response to CP98 and refined for CP146 and is being marketed as a &#39compliance guaranteed&#39 system for brokers, offering a full audit trail for lenders.Brokers submit the completed application form to Optoma, […]

The good news is that there was no bad news

Mervyn King is to be the next governor of the Bank of England. The news was revealed as Gordon Brown announced his pre-Budget report to the House of Commons at 3:30pm on Wednesday last week.The Chancellor has downgraded his hopes for UK economic growth, admitting for the first time that it will not meet his […]

Why your clients need some tough love

In any relationship that matters, professional or personal, you should be upfront with someone if you think they’re making a decision or doing something they might later regret. Being honest with someone and having their best interests at heart, however hard the message, is key to building trust in any relationship. So how does this […]


News and expert analysis straight to your inbox

Sign up