Included in this edition of InCredit: FCA tests overdrafts alerts; Industry associations launch global cybersecurity framework; New chair appointed to Cheque and Credit Board; UK Finance blog discusses rise of green mortgages and more... 


UK

FCA tests overdraft alerts

The Financial Conduct Authority (FCA) has published Occasional Paper 40, Time to act: A field experiment on overdraft alerts which describes a field test on automatically enrolling bank customers into additional overdraft alerts. The additional alerts tested were: i) just-in-time alerts for arranged overdraft usage, ii) early warning alerts for (arranged and unarranged) overdraft usage, and/or iii) early warning alerts for unpaid items.

FCA, 29 October 2018

Andrew Bailey on the FCA’s Brexit preparation and goals

The CEO of the FCA, Andrew Bailey, has given a speech at the City Banquet, Mansion House, in which he said the FCA is on course to be ready for a hard exit from the EU and has the resources to handle it. Longer term, Mr Bailey said the FCA wants the permanent arrangement post-Brexit to allow for close alignment with the EU, without the UK being a rule taker.

FCA, 26 October 2018

PRA CEO on how regulators and firms work together

The Prudential Regulation Authority (PRA) CEO, Sam Woods, has given a speech at the Mansion House City Banquet, setting out the two different roles the regulator often finds itself playing: "good cop and bad cop". Mr Woods said on issues of common ground where there are shared challenges that the regulator and the firms collectively face, there is no inherent conflict between the public and private interest and the regulator plays the role of good cop.

PRA, 26 October 2018

Industry associations launch global cybersecurity framework

The Financial Services Sector Coordinating Council (FSSCC) and a group of financial trade associations have launched a new Cybersecurity Profile. This provides a framework that integrates widely used standards and supervisory expectations to help guide financial institutions in developing and maintaining cybersecurity risk management programs and is the result of two years' work and collaboration among financial institutions, trade groups, and government agencies.

FSSCC, 26 October 2018

PRA postpones equity release mortgage changes to SS3/17

The PRA has announced that it is postponing the date of implementation of the changes to SS3/17 Solvency II: matching adjustment—illiquid unrated assets and equity release mortgages, which were proposed in CP13/18 Solvency II equity release mortgages. CP13/18 proposed an implementation date of 31 December 2018. In view of feedback received, the PRA has decided that the implementation date will not be before 31 December 2019.

PRA, 26 October 2018

New chair appointed to Cheque and Credit Board

A new independent chair, Richard Anderson, has been appointed to the Cheque and Credit Clearing Company Limited (C&CCC) board. Mr Anderson was appointed on 16 October 2018, and replaces Jane Bevis, who has stepped down for health reasons after more than three years in the role.

C&CCC, 24 October 2018

TheCityUK report shows strength of UK’s global financial services industry

TheCityUK has published a report showing that the UK remains the world’s leading net exporter of financial services, generating an industry trade surplus of £68bn in 2017, nearly equal to the next three leading net exporting countries combined (the US, Switzerland, and Luxembourg).

TheCityUK, 25 October 2018

UK Finance blog discusses rise of green mortgages

UK Finance has published a blog explaining green mortgages, where consumers taking out financing for an energy-efficient property can benefit from a cheaper rate on their mortgage. The short guide sets out how they work, why they appeal to governments and lenders, and how they fit into EU energy efficiency policy.

UK Finance, 25 October 2018

Report and UK Finance response published in relation to SME complaints and resolution review

UK Finance has published a report by Simon Walker, former director-general of the Institute of Directors, on his review into the complaints and alternative dispute resolution (ADR) landscape for the UK's small-to-medium enterprise (SME) market, which recommends new routes for SMEs to challenge banks without going to court. UK Finance has also published its response to Mr Walker's report.

UK Finance, 24 October 2018

Worldwide

ESMA publishes pan-European enforcement priorities for 2018 annual financial reports

The European Securities and Markets Authority (ESMA) has published a public statement on European common enforcement priorities for 2018 annual financial reports, which is intended to promote the consistent application of the International Financial Reporting Standards (IFRS) and other financial and non-financial reporting requirements.

ESMA, 26 October 2018

BIS publishes speech on new loan provisioning standards and procyclicality

Mr Borio said the new expected credit loss provisioning standard (IFRS 9) would be likely to mitigate the procyclicality of the financial system to some extent relative to the previous incurred loss model. But he said the new standard "falls short by a significant margin of what one would like from a financial stability perspective".

BIS, 24 October 2018

Key contacts

Amanda Hulme

Amanda Hulme

Partner, Head of Financial Regulation
London

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Lorna Finlayson

Lorna Finlayson

Partner, Financial Regulation
Edinburgh

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Rosanna Bryant

Rosanna Bryant

Partner, Financial Regulation
Leeds, UK

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