Enhanced powers granted to new UK regulators marks shift in supervisory approach
Financial institutions’ chief concern should be the increasing costs and complexity in legislation as FCA, PRA and FPC pick up the interventionist baton from FSA UK. July 05, 2013 | Magessan RajWith abolition of the Financial Services Authority (FSA) UK, as of April 1st 2013, the majority of its functions were transferred to three new regulatory entities – the Financial Conduct Authority (FCA), Prudential Regulatory Authority (PRA), and the Financial Policy Committee (FPC). Introduced via the Financial Services Act 2012, the reforms were intended to provide a clearer division of responsibilities between regulators, with enhanced investigation and enforcement powers endowed to the new regime highlighting renewed commitment to investigate and take enforcement action against errant financial firms. While FSA undoubtedly put in place a financial regulatory structure that helped make London one of the leading global financial centres, it had a reputation of falling “asleep at the wheel”, with financial firms that had been recently associated with the principle of light regulation applied by FSA during more prosperous times often regarded with suspicion in financial circles. FCA is responsible for regulating conduct related to the sale, management and investment management by financial institutions and individuals involved in the financial sector. Financial institutions that were previously regulated by the FSA, including forex brokers and other related companies are now registered with and regulated by the FCA, which has taken on a huge portion of the former’s functions. PRA is primarily concerned with capital strength and liquidity of financial institutions. For example, when a bank opens an account for a customer, it is necessary to have enough capital as shareholders' funds, against which should put the responsibility it has with the customer. The PRA is responsible for the prudential regulation of capital-intensive financial institutions, including banks, insurers and certain investment comp... Please login to read the complete article. If you already have an account, you can login now or subscribe/register.
Categories: Regulation, Risk and Regulationriskregulation,Risk and Regulation, Regulation,Risk and Regulation, Keywords:FSA UK, FCA, PRA, FPC, Bank Of England, Tracey McDermott FSA UK, FCA, PRA, FPC, Bank of England, Tracey McDermott
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