This week has seen the FCA publish its 15th quarterly consultation paper. In other news, the FCA has published its third and final sunlight remedy report into cash savings account rates.


UK

FCA policy development update: December 2016

The FCA has published the latest policy development update (the last version was published in October 2016). This update summaries the FCA's future publications and highlights the changes that have been made since the FCA's previous publications schedule.

FCA, 2 December 2016

FCA quarterly consultation 15

The FCA has published its 15th quarterly consultation paper, which seeks views on changes to its rules and guidance relating to a number of different parts of the FCA Handbook, including:

  • pension projections for risk warnings;
  • decision making changes relating to the Money Laundering Regulations;
  • adviser charging for vertically integrated firms; and
  • changes to the Enforcement Guide and Decision Procedure and Penalties manual relating to the Co-operative and Community Benefit Societies Act 2014.

FCA, 2 December 2016

Retail banking market investigation

The CMA has investigated the supply of personal current accounts (PCAs) and banking services to small and medium-sized enterprises (SMEs)

CMA, 1 December 2016

New million pound penalties for breaching financial sanctions

From April 2017, the Treasury's Office of Financial Sanctions Implementation (OFSI) will be able to impose penalties for serious breaches of up to £1million or 50% of the breach, whichever is higher. 

HM Treasury, 1 December 2016

Investigatory Powers Act 2016

The Investigatory Powers Act has been published. It received Royal Assent on 29 November 2016. There are a number of financial-services related aspects, such as those relating to the FCA's power to request communications data.

Legislation.gov.uk, 1 December 2016

Supervising building societies' treasury and lending activities

The PRA has published a policy statement on supervising building societies' treasury and lending activities.

PRA, 1 December 2016

FCA introduces new sunlight rules for saving accounts and ISAs

The FCA has published its third and final sunlight remedy report into cash savings account rates, together with a press release. The purpose of the remedy is to alert customers to interest rates for cash savings accounts that are not prominently displayed but that may be earned by some customers.

FCA, 1 December 2016

PRA and FCA consult on amendments to rules and guidance on Loan to Income (LTI) ratios in mortgage lending

The PRA has published a consultation paper on proposed amendments to the Housing Part of the PRA Rulebook in respect of the Financial Policy Committee's (FPC) June 2014 recommendation on LTI ratios in mortgage lending in the owner occupied market. The FCA has issued a guidance consultation, which sets out its proposed amendments and clarification to the general guidance it issued in October 2014 regarding the FPC's LTI ratio recommendation.

PRA & FCA, 30 November 2016

Bank of England financial stability report number 40

Part A of the report sets out the Financial Policy Committee's (FPC) analysis of the major risks and actions it is taking in light of the risks. Part B summaries the FPC's analysis of the resilience of the financial system. The main points of interest set out in the report are in the following sections: Brexit, mortgage markets, capitalisation of the UK banking system, cyber risk, BoE system-wide stress simulation, procyclicality in insurance sector, heightened market volatility and 2016 non-bank financial stability risk and regulation assessment. Alongside the report, the BoE published the results of the 2016 stress test.

BoE, 30 November 2016

Call for input on high-cost credit

The FCA has published a call for input on high-cost credit, including reviewing the HCSTC price cap. Areas covered include:

  • High-cost products
  • Overdrafts
  • HCSTC price cap review
  • Repeat and multiple HCSTC borrowing

The call for input will close on 15 February 2017.

FCA, 29 November 2016

Strategy to make UK payments fit for the digital age

The Payment Strategy Forum has revealed a new strategic plan for the UK payments industry intended to make sure it is fit for the 21st century. This takes into account new regulations like PSD2 and the process of digitalisation, and includes moving the UK to a common message standard by the end of H2 2017 as part of an ambitious roadmap.

PSR, 29 November 2016

EU

Council of EU progress report on proposed EDIS Regulation and European Commission communication on completion of banking union

The Council of the EU has published a report (dated 25 November 2016) from the Presidency to Delegations on both the proposed Regulation establishing the European Deposit Insurance Scheme (EDIS) and the European Commission Communication on Completion of the Banking Union. The Council has also published a correction to the report.

Council of EU, 2 December 2016

Small companies have improved access to finance

Small and medium-sized companies in the euro area are seeing improvements in their financial situation and in their access to finance, the Survey on the Access to Finance of Enterprises (SAFE) shows. The companies reported an increased willingness of banks to provide credit at lower interest rates.

ECB, 30 November 2016

Consultation responses: EBA draft guidelines for credit institutions' credit risk management

The EBA has published an updated webpage on guidelines for credit institutions' credit risk management practices and accounting for expected credit losses, including consultation responses from the following organisations:

  • Association for Financial Markets in Europe
  • British Bankers' Association
  • European Banking Federation

The consultation took place in July 2016.

EBA, 29 November 2016

Chair outlines EBA's approach to developing RTS on strong customer authentication under PSD2

The EBA has published an introductory statement from the EBA Chair, delivered at a scrutiny hearing held by the Committee on Economic and Monetary Affairs (ECON). The purpose was to update on the work of the EBA under the revised Payment Services Directive, especially in relation to its mandate to produce RTS on strong customer authentication and secure communications. Current thinking on the following three main concerns was addressed: 

  • Monetary thresholds proposed in the draft RTS
  • Communication interface and direct access
  • Exemptions to SCA

EBA, 29 November 2016

Report on macroprudential policy issues

The European Systemic Risk Board has published a report on macroprudential policy issues arising from low interest rates and structural changes in the EU financial system. A related Q&As document has also been published.

ESRB, 28 November 2016

Key contacts

Amanda Hulme

Amanda Hulme

Partner, Head of Financial Regulation
London

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Rosanna Bryant

Rosanna Bryant

Partner, Financial Regulation
United Kingdom

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