1 Background, EU and Global Influences

2016 ◽  
Author(s):  
Morris Simon
Keyword(s):  
Financial Crisis ◽  
Financial Services ◽  
Regulatory Reform ◽  
Prudential Regulation ◽  
Financial Services Regulation ◽  
European Regulatory ◽  
History Of ◽  
The Government ◽  
Set Up ◽  
The Uk

This chapter traces the recent history of the UK system of financial services regulation. It begins by providing some context to the Gower Report of 1984, before detailing the changes that the resulting Financial Services Act (FSA) 1986 introduced (principally the establishment of self-regulating organisations (SROs)). The success of Labour’s replacement of the SROs with the Financial Services Authority (FSA) in 2000 (under the Financial Services and Markets Act (FSMA) 2000) is assessed in light of the financial crisis of 2007–2009. The key causes of the crash, and the actions of the Government and the FSA during it, are analysed. It explains the restructuring of the regulatory set-up (with the introduction of the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA)) following the crash. The influence of recent European regulatory reform on the UK is also considered.

A decade of deregulation?

2019 ◽  
pp. 1-26
Author(s):  
Oonagh McDonald
Keyword(s):  
Financial Crisis ◽  
Financial Regulation ◽  
Light Touch ◽  
Systematic Process ◽  
History Of ◽  
The Government ◽  
The Uk

This chapter traces the history of financial regulation in the UK. It challenges the widely held belief that the period from the 1980s witnessed a systematic process of deregulation. In fact, from the 1970s there was a period of increasing regulation up until the mid-2000s, when the government began to encourage a ‘light touch’ approach. The combination of all these factors meant that banks were ill-prepared to meet the financial crisis. In its aftermath, as the banks embarked on the slow path to recovery, making profits was essential. The traders seized any opportunity they could, and it may well be the case that banks were simply relieved that some areas of their business were profitable.

Part I Regulatory Structure, 2 Statutory Framework for UK Financial Services Regulation

2018 ◽  
Author(s):  
Walker George ◽  
Purves Robert ◽  
Blair Michael
Keyword(s):  
Financial Services ◽  
Regulatory Structure ◽  
Prudential Regulation ◽  
Financial Services Regulation ◽  
Bank Of England ◽  
Break Up ◽  
The Uk ◽  
Regulatory Reforms

This chapter examines the statutory framework for financial services regulation in the UK. The regulatory reforms that culminated in the break-up of the Financial Services Authority (FSA) and the return of regulatory responsibilities to the Bank of England have complicated but in many ways reinforced the original vision of a consolidated statutory framework for all financial services regulation under the Financial Services and Markets Act 2000 (FSMA). The FSMA is undoubtedly more complicated because of the need to accommodate collaboration between the Financial Conduct Authority (FCA) and the Bank of England acting as Prudential Regulation Authority (PRA). The chapter provides an overview of the structure and statutory framework of the FSMA as well as the functions of the FCA and the PRA. It also considers the scope of financial services regulation under the FSMA and the confidentiality of information obtained by the FCA and the PRA in the discharge of their functions.

Developing Trade in Services

2019 ◽  
Vol 250 ◽  
pp. R30-R33
Author(s):  
Alexis P. Lautenberg
Keyword(s):  
Financial Services ◽  
Trade In Services ◽  
Executive Summary ◽  
Services Sector ◽  
Regulatory Standards ◽  
European Regulatory ◽  
The Status ◽  
The Government ◽  
The Uk ◽  
The Eu

Executive SummaryServices are simultaneously the most important sector of the UK economy and the sector facing the biggest challenge as a result of Brexit. The prospective departure from the European Single Market reduces the UK to the status of ‘3rd country’ in respect of services. Accessing the internal market will depend on both subjective and objective conditions that differ from sector to sector, requiring detailed and highly specific arrangements for such industries as aviation and financial services.In practice, the EU can be expected to use these circumstances to discourage the UK from significantly diverging from European regulatory norms, as a matter of policy. In view of the weakness of, and uncertainty surrounding, international moves to oversee, let alone to further liberalise, trade in services, Brexit will thus leave the UK's services sector – and especially financial services – uniquely isolated and exposed. The government will hence need to consider carefully the costs of decisions to diverge from EU regulatory standards, and should be giving great priority to establishing clear objectives for close cooperation between the UK and the EU policy makers and regulators.

Part II Financial Services Regulation, 5 The PRA and FCA

2018 ◽  
Author(s):  
Walker George ◽  
Purves Robert ◽  
Blair Michael
Keyword(s):  
Financial Services ◽  
Central Government ◽  
Prudential Regulation ◽  
Services Sector ◽  
Financial Services Sector ◽  
Financial Services Regulation ◽  
Regulated Firms ◽  
The Uk ◽  
Parliamentary Oversight

This chapter focuses on the functions of the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA) as statutory regulators of the financial services sector in the UK. It begins with a discussion of the constitutional provisions establishing the FCA and the PRA by virtue of the Financial Services and Markets Act 2000 (FSMA). It then considers the remit of the FCA and the PRA, along with their general functions and duties, statutory objectives, and regulatory principles with respect to financial services regulation. It also examines the boundary between FCA and PRA responsibilities, arrangements for the supervision of regulated firms and for enforcement, and the co-ordination between the FCA and the PRA in the exercise of their function. Finally, it describes the PRA's power of direction, directions relating to consolidated supervision, and central government and Parliamentary oversight of the regulators.

Part II Financial Services Regulation, 7 Regulatory Processes— Authorisation and Supervision

2018 ◽  
Author(s):  
Walker George ◽  
Purves Robert ◽  
Blair Michael
Keyword(s):  
Financial Services ◽  
Prudential Regulation ◽  
Regulatory Processes ◽  
Financial Services Regulation ◽  
Supervision Process ◽  
The Uk

This chapter discusses four ways in which a person can conduct regulated activities in the UK without contravening the Financial Services and Markets Act 2000 (FSMA): they can be either exempt, passported, unauthorised but exempted from the general prohibition, or hold a relevant permission under Part 4A of the FSMA. It first explains exemptions and exempt persons under FSMA before addressing the question of whether a person requires authorisation and who are eligible to apply for authorisation. It then considers the consequences of authorisation, the authorisation process, permissions under Part 4A of the FSMA, variations and cancellations of a permission, and the procedure for authorisation application. It also examines how applications for authorisation are determined and concludes with an analysis of the supervision process used by the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA), along with the enforcement processes.

Financial Services Regulation in Practice

2016 ◽  
Author(s):  
Morris Simon
Keyword(s):  
Financial Crisis ◽  
Financial Services ◽  
Comprehensive Analysis ◽  
Senior Management ◽  
Financial Crime ◽  
European Economic Area ◽  
Financial Services Regulation ◽  
Economic Area ◽  
Regulatory Bodies ◽  
The Uk

This textbook provides an overview of the current landscape of financial services regulation in the UK. Following the financial crisis, the UK regulatory scene has undergone significant changes. This book explains the different functions and responsibilities of the various UK regulatory bodies, most notably the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA). The constitutions, objectives, and rules that govern the behaviour of these key UK regulatory authorities are examined. The fundamental concept of the ‘general prohibition’—which provides that no person may carry on a regulated activity in the UK unless authorised or exempt—is given a thorough treatment. The regulated activities covered by the general prohibition, and any exclusions (contained in the Regulated Activities Order (RAO)), are also considered. The standards required of firms and individuals are given comprehensive analysis: the FCA’s five main conduct of business sourcebooks are scrutinised, as is the increased regulator engagement with the regulation of individuals (specifically in relation to senior management and customer—facing staff). The key concept of passporting within the European Economic Area (EEA) is explained for firms based in the EEA and the UK. Both the prudential regulations imposed by UK regulators and the regulations on financial promotions are reviewed. The regulators’ role in relation to financial crime is analysed. The nature of the FCA and PRA’s powers of enforcement and supervision are discussed. Consideration is also given to the various ways in which consumers may obtain redress.

4 The Constitution and Powers of the UK Regulators

2016 ◽  
Author(s):  
Morris Simon
Keyword(s):  
Financial Services ◽  
Good Governance ◽  
Financial Policy ◽  
Prudential Regulation ◽  
Financial Services Regulation ◽  
Bank Of England ◽  
The Uk ◽  
New System ◽  
Policy Committee

This chapter explains the interrelated powers and responsibilities of the various UK bodies involved in the new system of financial services regulation. The role, constitution, and powers of the Bank of England and the Financial Policy Committee (FPC) are reviewed. The policies, statutory framework, and constitutions of the Prudential Regulation Authority (PRA) and Financial Conduct Authority (FCA) are assessed. The provisions—the eight regulatory principles (3B), the principles of good governance (3C), the requirement to coordinate with one another, and requirement to cooperate with any treasury-ordered enquiry into serious regulatory failures—which apply to both the PRA and FCA are examined.

Part II Financial Services Regulation, 6 The FCA Handbook and the PRA Rulebook

2018 ◽  
Author(s):  
Walker George ◽  
Purves Robert ◽  
Blair Michael
Keyword(s):  
Financial Services ◽  
Prudential Regulation ◽  
Financial Services Regulation ◽  
Primary Consolidation ◽  
The Uk ◽  
High Level

This chapter focuses on the Financial Conduct Authority's (FCA) Handbook of Rules and Guidance and the Prudential Regulation Authority's (PRA) Rulebook. The FCA Handbook of Rules and Guidance and the PRA Rulebook are two of the most important products or physical expressions of the FCA and PRA's general functions with respect to financial services regulation: they are the primary consolidation of the rules, and (in the case of the FCA) guidance through which that regulator performs its particular functions. The chapter first explains what material goes into the FCA Handbook and the PRA Rulebook before providing an overview of the structure and content of each document. It then examines high-level standards in the FCA Handbook and the PRA Rulebook, along with the rise and fall of principles-based regulation in the UK. It also considers the processes governing the Handbook and Rulebook as well as the interpretation of both documents.

The Systemic Effects of Prudential Regulation Toughening:The Results of a Stress-test for Russian Banks

2012 ◽  
pp. 4-31 ◽  
Author(s):  
M. Mamonov ◽  
A. Pestova ◽  
O. Solntsev
Keyword(s):  
Financial Services ◽  
Banking Sector ◽  
Stress Test ◽  
Credit Market ◽  
Capital Adequacy ◽  
Government Support ◽  
Government Ownership ◽  
Prudential Regulation ◽  
The Government ◽  
The Stability

The stability of Russian banking sector is threatened by three negative tendencies - overheating of the credit market, significant decrease of banks capital adequacy ratios, and growing problems associated with banks lending to affiliated non-financial corporations. The co-existence of these processes reflects the crisis of the model of private investments in Russian banking sector, which was observed during the last 20 years. This paper analyzes the measures of the Bank of Russia undertaken to maintain the stability of the banking sector using the methodology of credit risk stress-testing. Based on this methodology we conclude that the Bank of Russias actions can prevent the overheating of the credit market, but they can also lead to undesirable effects: further expansion of the government ownership in Russian banking sector and substitution of domestic credit supply by cross-border corporate borrowings. The later weakens the competitive positions of Russian banks. We propose a set of measures to harmonize the prudential regulation of banks. Our suggestions rely on design and further implementation of the programs aimed at developing new markets for financial services provided by Russian banks to their corporate and retail customers. The estimated effects of proposed policy measures are both the increase in profitability and capitalization of Russian banks and the decrease of banks demand for government support.

scholarly journals The politics of bailouts: Estimating the causal effects of political connections on corporate bailouts during the 2008–2009 US financial crisis

Public Choice ◽  
2021 ◽  
Author(s):  
Vuk Vukovic
Keyword(s):  
Financial Crisis ◽  
Financial Services ◽  
The United States ◽  
Political Campaigns ◽  
Political Connections ◽  
Troubled Asset Relief Program ◽  
Top Executives ◽  
The Government ◽  
The Right ◽  
Relief Program

AbstractIn 2008, as the financial crisis unfolded in the United States, the banking industry elevated its lobbying and campaign spending activities. By the end of 2008, and during 2009, the biggest political spenders, on average, received the largest bailout packages. Is that relationship causal? In this paper, I examine the effect of political connections on the allocation of funds from the Troubled Asset Relief Program (TARP) to the US financial services industry during the 2008–2009 financial crisis. I find that TARP recipients that lobbied the government, donated to political campaigns, or whose top executives had direct connections to politics received better bailout deals. I estimate regression discontinuity design and instrumental variable models to uncover how election outcomes for politicians in close races affected the distribution of bailout funds for connected firms. The results do not imply that some banks were deliberately favored over others, just that favored banks benefited because of their proximity to the right people in power. If being politically connected matters in general, in times of crisis it matters even more.

Sign in / Sign up

Export Citation Format

Share Document