Latest news with #PrudentialRegulationAuthority
The Independent
9 hours ago
- Business
- The Independent
Watchdogs insist reducing regulation will not increase risk of financial crisis
Financial watchdogs have insisted that the risk of a financial crisis will not increase as a result of measures announced by the Chancellor to cut regulation in a bid to deliver growth. Under questioning by the Commons Business and Trade Committee, a senior civil servant also confirmed the target to cut red tape by 25% will be measured in terms of costs to firms of current requirements, with a baseline set to be confirmed in 18 months. Rachel Reeves has unveiled a package of reforms to the UK's financial system aimed at boosting the economy and spurring on retail investing. The changes include reforming the bank ring-fencing regime and reducing burdensome regulation in the City in order to reintroduce 'informed risk-taking' into the financial system, the Government said. The Chancellor said the 'Leeds reforms', unveiled in the West Yorkshire city, 'represent the widest set of reforms to financial services for more than a decade'. Liam Byrne, Labour chairman of the Business and Trade Committee and a former chief secretary to the Treasury, said evidence suggests liberalisation of regulation is 'often accompanied by lending booms that end badly'. He asked senior officials tasked with implementing the changes whether the announcements made by the Chancellor would increase the risk of a financial turmoil. David Bailey, executive director at the Prudential Regulation Authority (PRA), said the organisation had 'built overall resilience in the system' since the financial crash in 2008. He added: 'The risk of a financial crisis, from the PRA's perspective in banking insurance, has not gone up because we have maintained the same level of reliance.' Sarah Pritchard, deputy chief executive at the Financial Conduct Authority, said there should be a public debate about 'where should the risk appetite be set' if, for example, greater access to mortgages leads to an increase in repossessions in the event of an economic downturn. When pressed on how measures announced today are different to previous 'liberalisation' implemented before previous financial crises, she added: 'There is nothing in today's set of announcements that causes me any different concern to that that David has set out.' When questioned on whether the measures will lead to a rise in asset prices if lending increases, Ms Pritchard added: 'There are a range of different factors at play. 'I think regulation is one aspect, but the general environment in which we all operate, in particular the UK being a global connected system, there is no one point that I would refer to in terms of that package today that is saying that will cause any different market risk or volatility.' Mr Byrne later pressed Chris Carr, director at the Department of Business and Trade, on how the target to reduce the administrative burden of regulation by 25% will be set. He confirmed the target is to reduce the burden to the planned level over the course of this Parliament and said the cost in pounds to businesses caused by red tape will be the measure. Mr Carr added: 'We have to agree and publish a baseline of the administrative burden and then strive to reduce it by 25%.' When asked how long it is expected to take for the baseline to be set, competition and markets minister Justin Madders said: 'We think it is going to take about 18 months, which is akin to the timescale it took under the last Labour government's similar exercise.'
Mint
12 hours ago
- Business
- Mint
Top Bankers Face Looser Conduct Rules Under UK Deregulation Push
UK regulators are planning to streamline a post-crisis regime that covers the conduct of senior bankers, part of the government's efforts to ease regulations and drive growth in financial services. The Financial Conduct Authority and the Prudential Regulation Authority said in a statement Tuesday that they aim to make the so-called Senior Managers Certification Regime 'less onerous' on firms while continuing to protect consumers and markets, and the safety and soundness of businesses. The regime was introduced in the aftermath of the 2008 financial crisis to ensure executives at financial-services firms can be held to account for misconduct that occurs on their watch. The move to simplify some of the rules is meant to ensure 'they work better for industry and support competitiveness,' FCA's chief executive Nikhil Rathi said in the statement. The tweaks are part of a blizzard of announcements by the watchdogs early Tuesday, with Chancellor of the Exchequer Rachel Reeves announcing measures to spur home ownership at an event in Leeds ahead of her Mansion House address — a heavily-choreographed setpiece that's keenly watched by the City of London bankers. Among the other announcements were an overhaul of the Financial Ombudsman Service that resolves customer complaints and a fresh review of the ring-fencing of lenders' retail and investment banking activities. Other measures in the Leeds review include: This article was generated from an automated news agency feed without modifications to text.
Reuters
16 hours ago
- Business
- Reuters
UK regulators propose simplifying senior manager certification rules
LONDON, July 15 (Reuters) - Britain's Financial Conduct Authority and Prudential Regulation Authority proposed changes on Tuesday to simplify the senior managers and certification regime in a bid to reduce red tape for financial firms. "We are proposing streamlining the rules, so they work better for industry and support competitiveness... while maintaining the high standards the regime has set," FCA Chief Executive Nikhil Rathi said. The proposals include giving firms more time to appoint senior managers in unexpected situations, cutting duplication in certification roles and extending the validity of criminal record checks. The consultation, part of broader efforts to support growth in financial services, runs until October 7.
South Wales Guardian
17 hours ago
- Business
- South Wales Guardian
Bank of England to ease rules for smaller and mid-sized banks
It came as the central bank said it will push ahead with the majority of new capital rules for British banks at the start of 2027 but will delay part of the proposals. The Bank said its Prudential Regulation Authority (PRA) has pushed back the start of a new internal model approach for considering risk in the market by a year to January 1 2028. It said the latest proposals will allow time 'for greater clarity to emerge in other jurisdictions' amid uncertainty how President Trump will implement the global Basel rules in the US. The Basel 3 regime was first drawn up in the aftermath of the financial crisis to increase the amount of equity available to absorb stress from banks in an effort to avoid future state bailouts. The Bank of England said it will continue with plans to launch the majority of its modified Basel 3.1 rules at the start of 2027. It had previously delayed the start by a year in the face of uncertainty in the global financial markets. Basel 3.1 is set to promote 'banking resilience', according to the PRA, but comes as the Chancellor seeks reduce regulation in a bid to drive growth. On Tuesday, the Bank said it would also change restrictions it claims will drive growth opportunities among smaller and mid-sized banks. It will push forward with its 'strong and simple framework', which will reduce capital rules for smaller non-systemic banks and building societies, providing them with simpler restrictions than the largest UK banks. The PRA said it is also putting forward prospective plans to make it easier for mid-sized banks to compete in the mortgage market. It will publish a paper this summer with options to help-mid-sized banks grow by adjusting some barriers to securing permissions in providing residential mortgages. Sam Woods, chief executive of the PRA and deputy governor for prudential regulation at the Bank, said: 'Today's announcements will give certainty to firms of all sizes about the future capital framework, bring in a simpler regime for smaller banks, make it easier for mid-sized banks to scale up in the mortgage market, and allow an extra year for part of the implementation of new investment banking rules.' Dave Ramsden, deputy governor for markets and banking at the Bank, said: 'We have considered and reflected industry feedback in today's announcements. 'These changes are designed to foster growth and competition, recognising that smaller firms present lower risks to financial stability, whilst also maintaining size-appropriate resolvability capabilities.' The rule changes come ahead of the Chancellor's Mansion House speech to financial industry bosses, where she is expected to launch further cuts of industry red tape.
Rhyl Journal
18 hours ago
- Business
- Rhyl Journal
Bank of England to ease rules for smaller and mid-sized banks
It came as the central bank said it will push ahead with the majority of new capital rules for British banks at the start of 2027 but will delay part of the proposals. The Bank said its Prudential Regulation Authority (PRA) has pushed back the start of a new internal model approach for considering risk in the market by a year to January 1 2028. It said the latest proposals will allow time 'for greater clarity to emerge in other jurisdictions' amid uncertainty how President Trump will implement the global Basel rules in the US. The Basel 3 regime was first drawn up in the aftermath of the financial crisis to increase the amount of equity available to absorb stress from banks in an effort to avoid future state bailouts. The Bank of England said it will continue with plans to launch the majority of its modified Basel 3.1 rules at the start of 2027. It had previously delayed the start by a year in the face of uncertainty in the global financial markets. Basel 3.1 is set to promote 'banking resilience', according to the PRA, but comes as the Chancellor seeks reduce regulation in a bid to drive growth. On Tuesday, the Bank said it would also change restrictions it claims will drive growth opportunities among smaller and mid-sized banks. It will push forward with its 'strong and simple framework', which will reduce capital rules for smaller non-systemic banks and building societies, providing them with simpler restrictions than the largest UK banks. The PRA said it is also putting forward prospective plans to make it easier for mid-sized banks to compete in the mortgage market. It will publish a paper this summer with options to help-mid-sized banks grow by adjusting some barriers to securing permissions in providing residential mortgages. Sam Woods, chief executive of the PRA and deputy governor for prudential regulation at the Bank, said: 'Today's announcements will give certainty to firms of all sizes about the future capital framework, bring in a simpler regime for smaller banks, make it easier for mid-sized banks to scale up in the mortgage market, and allow an extra year for part of the implementation of new investment banking rules.' Dave Ramsden, deputy governor for markets and banking at the Bank, said: 'We have considered and reflected industry feedback in today's announcements. 'These changes are designed to foster growth and competition, recognising that smaller firms present lower risks to financial stability, whilst also maintaining size-appropriate resolvability capabilities.' The rule changes come ahead of the Chancellor's Mansion House speech to financial industry bosses, where she is expected to launch further cuts of industry red tape.
