FCA to investigate interest-only market

Posted April 20, 2017

The UK Financial Conduct Authority (FCA) will prioritise supporting the government with Brexit and helping consumers wrongly sold payment-protection insurance, according to its business plan for next year, published alongside a "Mission" statement that ushers in a new era at the regulator.

He said: "Both we and the Government are keen to ensure that the financial services industry remains resilient and well placed to meet users' needs and thus make the most of opportunities in a post-Brexit world". Banks have already paid out 26.2 billion pounds in PPI compensation to consumers.

But it adds that there is "little information about the form and nature" of negotiations and this "lack of clarity" could lead to "prolonged uncertainty for markets, firms and consumers". "We ought to set up a system of open markets where firms make these choices, not regulators and governments", Bailey told reporters.

Bailey, who was previously Bank of England deputy governor, took up the role of FCA CEO in July, one year after former chief Martin Wheatley was ousted by then Chancellor of the Exchequer George Osborne.

Brexit might only have been mentioned once in the FCA's mission paper consultation, but it looms large over the series of papers published this week.

In its annual business plan for the upcoming year, Britain's competition watchdog made dealing with the uncertainties surrounding the Brexit negotiations a priority.

The Financial Conduct Authority (FCA) has told advisers to pay closer attention to the total cost of the investment chain, warning clients were at risk of receiving poor value for money. The SMCR puts the onus on firms to approve individuals as fit and proper to work for them and more clearly outlines the responsibilities of senior individuals to improve accountability.

Bailey was also asked about the importance of the whistleblowing regime, a focus since last week's revelations that Jes Staley, chief executive of Barclays, was being investigated for trying to identify a whistleblower.

Bailey, however, said he expected financial market access to be based on such a "regulatory equivalence" system, rather than on adherence to global principles, which he would prefer.