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  • Robert Bell

Consultation On The Introduction Of A Financial Resilience Regulatory Return

The Financial Conduct Authority’s Consultation on a new quarterly financial resilience return has just closed, with the new rules expected out in Spring. The Regulator has found that having access to “high quality baseline financial resilience data on a regular basis” has improved their ability to protect consumers and ensure market integrity through rapid assessment of resilience risks, allowing for early intervention. The FCA currently collects data through ad hoc surveys, and so wants to shift to standardised collection through regulatory return.

The survey evolved from the Covid-19 impact survey, and while the FCA have found it invaluable, the length of time needed to complete the surveys, the relatively short deadlines – and the regularity with which the FCA was sending them out – had caused some complaints across the industry.

Funeral Plan Providers: New FCA Regulations




The Regulator suggests that standardising the return will help to reduce the administrative and financial burden that the ad hoc survey currently imposes. A regulatory return would also offer access to guidance and previous submissions that the current survey format does not.

The return – FIN073 – would apply to all FCA regulated firms except credit brokers, MIFIDPRU investment firms, not-for-profit debt advice bodies, PRA-authorised firms, supervised run-off firms or Temporary Permission firms.

The return would cover five questions – down from nine in the current survey format – that are designed to give the FCA a clear view of the baseline financial resilience position. The questions would ask:

  1. What is the total amount of liquid assets that you control or have unrestricted access to?

  2. What are your average monthly cash needs arising from fixed costs?

  3. What is your net profit OR loss in the last quarter?

  4. What was your revenue in the last financial year?

  5. Please report your net asset or liability position at the end of the last (calendar) quarter.

The data would be submitted once every quarter – unchanged from the survey – in March, June, September and December. The FCA did consider asking for data as frequently as once a month, but that was felt to be disproportionate.

Regardless, there are concerns that the switch from ad hoc survey to regulatory return will place a higher burden on firms at a time when the obligations of the Consumer Duty are taking up a lot of Compliance resource and time. While the survey was mandatory, firms only needed to complete on a ‘best-efforts’ basis. A regulatory return formalises that submission.

Some in the industry have argued that while they could understand the regulator’s rationale for the switch to a regular return, the support that could be offered in the event of a firm going under was not clear.

The Consultation Paper goes some way to answering this question, saying that firms that needed intervention would be ‘prioritised’ and firms with the lowest resilience and the greatest risk of harm would be subject to ‘targeted supervisory intervention’. The FCA also hopes that having improved awareness of their own financial resilience will help firms to self-identify mitigation actions.

The FCA are currently considering comments and feedback and will publish a policy statement and final rules in Spring 2023.

We offer a number of online training courses that support operational resilience in your firm through preparing staff to understand and work within the FCA and other regulators’ rules and expectations. Our Complaints Handling course provides all the skills needed to engage with the complainant, and to investigate, resolve and respond to complaints.

We also offer courses Data Protection and Information Security which delivers the background to applicable legislation and how to avoid security breaches. Our Understanding Data Protection Regulation courses have two options – one for front-line staff, and one for senior staff.

Our training is accessible online, so staff can complete the learning and assessment at their convenience, ideal for those who want to complete the course in their own time, and to come back to it to refresh later on. Each course is accessible at the delegate’s convenience and provides a certificate upon successful completion, allowing firms to track and record each user’s progress.


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