PREPARATIONS for Brexit will see City watchdog the Financial Conduct Authority (FCA) dedicate a high level of its resources to withdrawal, given its impact on regulation and the firms it has to regulate.
In its business plan for the coming year, the FCA set out its priorities across seven sectors, apart from Brexit.
Chief executive, Andrew Bailey, said: “The business plan is an important way in which we are transparent about our priorities for the year. We recognise that this year we need to dedicate a significant amount of resource to withdrawal from the EU.
“As a result, setting our priorities this year has involved a particularly rigorous level of scrutiny and challenge to focus on areas where we see the greatest potential for harm.”
The FCA said its priorities were also based on where its intervention could have the greatest impact.
High-cost credit remains one of the watchdog’s biggest concerns, and it aims to build on the “significant” impact it has already made on the market.
It said the culture and governance of firms should drive behaviours and produce outcomes which were likely to benefit consumers and markets.
In his introduction to the report, Bailey, said: “Firms’ culture and governance is pivotal to building public trust and confidence in the UK’s financial services industry, both domestically and internationally. We continue to implement the reforms that followed the financial crisis.”
The FCA also intends to tackle financial crime, including fraud, scams and anti-money laundering, to make the financial services sector a “hostile place” for criminals and safe for consumers.
With technology playing a pivotal role in delivering financial products and services, the FCA will have a focus on data security, resilience and outsourcing, along with innovation, big data, technology and competition, which it said were driving changes in markets.
It also wants to make sure that existing customers do not get less attention or receive poorer outcomes than new customers. It will keep an eye on the market for long-term savings, pensions and intergenerational differences, reflecting the changing UK population and their financial needs.
Bailey added: “Planning our priorities for the next year has again underlined how technology is supporting competition, transforming markets and changing the way consumers engage with them. The take-up of technology and innovation across and between firms is accelerating, creating a conveyor belt of risks and opportunities.
“These are often finely nuanced, so this year we have agreed two clearly defined priority themes to address different aspects of technological regulation, application and resilience.
“This business plan explains why tackling risks including cyber and financial crime, as well as staying ahead of developments in big data and open banking, remains a priority.”
Charles Randell, the incoming FCA chair, added it would be a challenging year: “To achieve our priorities, as well as plan for EU withdrawal, while continuing to deliver our core regulatory activities effectively, will require us to use our resources efficiently and flexibly.
“I know we will also be looking hard at how we can be an even more accountable and transparent regulator,” he added.
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