Included in this edition of InCredit: FCA's paper on fairness of pricing in financial services; CMA's letter to Nationwide; FCA policy development update; Results of the EU-wide stress test coordinated by EBA and more...


UK withdrawal from the EU: Changes to PRA Rulebook and onshored Binding Technical Standards

The Prudential Regulation Authority ("PRA") has updated the complete version of CP26/18 and separate Appendix 5 document. The draft BTS EU Exit Instrument for the Financial Conglomerates Technical Standards has been added to the end of the documents. This consultation paper (CP) sets out the’ PRA's proposals to fix deficiencies arising from the UK’s withdrawal from the EU in the PRA Rulebook, and in relation to BTS within the PRA’s remit that will be converted, or ‘onshored’, into UK law.

PRA, 2 November 2018

FCA's Discussion Paper on fairness of pricing in financial services

On 31 October 2018 the Financial Coduct Authority ("FCA") published a Discussion Paper on the fairness of certain pricing practices in financial services. The FCA stated that the judgment of when price discrimination is fair is not always straightforward. The FCA is therefore launching a public debate on this subject and intends to take into account stakeholder views on its approach to deciding whether and how to act in the markets it regulates.

FCA, 31 October 2018

HM Treasury's consultation on Breathing Space and Statutory Debt Repayment Plan

Following the Chancellor's Budget speech, HM Treasury published a consultation on its policy proposal for a Breathing Space and Statutory Debt Repayment Plan. Consultation on these policies represents the Government’s approach to managing problem debt and assisting vulnerable consumers.

HM Treasury, 28 October 2018

CMA confirms TSB compliance with alerts requirement under the Retail Banking Market Investigation Order 2017

The Competition and Markets Authority ("CMA") revoked the Directions given to TSB Bank plc on 2 March 2018 on confirmation by the Bank that it had met the requirements of the Directions to the satisfaction of the CMA.

CMA, 2 November 2018

CMA's letter to Nationwide

The CMA has written a letter to Nationwide on its breaches of the Northern Ireland Personal Current Account Banking Market Investigation Order 2008. From January to May 2017, Nationwide i) failed to include wording reminding customers that they can close the PCA and seek to obtain PCA services from a different bank; and where the customer can find further information on the process of how to do this and ii) failed to provide a copy of the Switching Leaflet to customers. This letter sets out the action agreed between the CMA and Nationwide to remedy the breaches of the Order.

CMA, 30 October 2018

FCA policy development update for November 2018

The FCA published the November edition of their policy development update. Future publications include "Claims management: how we will regulate claims management companies - PS to CP18/15 and CP18/23", and "General standards and communication rules for the payment services and e-money sectors – PS to CP18/21".

FCA, 2 November 2018

FCA publishes its response to independent panels' annual reports for 2017/18

Their responses to the panels’ reports are grouped into 2 sections. Firstly, they look at themes that are common across all or most of the panels. For example, all of the panels highlighted: Brexit; Operational Resilience; Regulatory Burden and Culture, both in the industry and within FCA. Secondly, the response looks at more specific issues raised by individual panels.

FCA, 1 November 2018

Splitting the Bill: The role for shared platforms in financial services regulation

A publication by the TheCityUK outlines seven shared digital platforms and analyses how government, regulators and financial firms working together could unlock a range of strategic benefits for the UK. For example, Shared platforms for monitoring, identifying, tracking and reporting fraud and attempted fraud can ensure greater transparency across the industry, whereas shared platforms for providing KYC functions could enhance the customer experience by standardizing processes.

TheCityUK, 1 November 2018

The PRA’s approach to supervision - 2018

The PRA approach documents set out how the PRA carries out its role in practice. They are designed to help regulated firms and the market understand how the PRA supervises these institutions, and to aid accountability to the public and Parliament.

PRA, 31 October 2018

Ring-fencing: PRA issues guidance on reporting requirements

This ring-fencing: summary of regulatory reporting requirements pack is aimed at UK banking groups in scope of structural reform requirements from 1 January 2019. These firms will be required to submit ring-fencing regulatory returns. The objective of this information document is to summarise the new regulatory reporting requirements and reporting system requirements in relation to ring-fencing.

PRA, 30 October 2018

ICO data protection sandbox

UK Finance has published a press release commenting on the Information Commissioner's Office (ICO)’s recent consultation on some fundamental principles to inform its development of a 'regulatory sandbox'.

UK Finance, 30 October 2018


EBA stress test shows euro area banks are more resilient to financial shocks

The results of the EU-wide stress test coordinated by the European Banking Authority (EBA) show that the 33 largest banks directly supervised by the European Central Bank (ECB) have become more resilient to financial shocks over the past two years. Despite a more severe adverse scenario than in the 2016 stress test, the average CET1 capital ratio of all 33 banks after a three-year stress period was higher at 9.9%, up from 8.8% two years ago.

EBA, 2 November 2018

BIS general manager on the evolution of money

A speech by Mr Agustín Carstens, General Manager of the BIS, at the Finance and Global Economics Forum looks at money and payment systems in the digital age.

BIS, 1 November 2018

EBA publishes final guidance on management of non-performing and forborne exposures

The Guidelines, developed in accordance with the European Council Action Plan, aim to ensure that credit institutions have adequate prudential tools and frameworks in place to manage effectively their non-performing exposures (NPEs) and to achieve a sustainable reduction on their balance sheets. To this end, the Guidelines require institutions to establish NPE reduction strategies and introduce governance and operational requirements to support them.

EBA, 31 October 2018

Non-performing loans: Council approves position on capital requirements for banks' bad loans

On 31 October, EU ambassadors approved the Council's position on capital requirements applying to banks with non-performing loans (NPLs) on their balance sheets. The proposal, initially put forward by the Commission in March 2018, aims at creating a prudential framework for banks to deal with new NPLs and thus to reduce the risk of their accumulation in the future. In particular, it sets requirements to set aside sufficient own resources when new loans become non-performing and creates appropriate incentives to address NPLs at an early stage.

Council of the European Union, 31 October 2018

Key Contacts

Amanda Hulme

Amanda Hulme

Partner, Head of Financial Regulation

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Lorna Finlayson

Lorna Finlayson

Partner, Financial Regulation

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Rosanna Bryant

Rosanna Bryant

Partner, Financial Regulation and Co-head of Financial Services Sector

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