4. Additional key workstreams

4. Additional key workstreams

Other key elements of our work this year will include:

Sustainable regulation

We are committed to ensuring that the UK has robust, respected regulation. We will be tough when required but we also recognise that regulation must be able to adapt and evolve to the changing market place. 

We will review whether aspects of our rules are outdated or are no longer an effective way of advancing our statutory objectives. Following this, we will consider whether any rules can be removed or redrafted to better achieve our statutory objectives. 

The Enterprise Bill, currently being debated in Parliament, may also apply to the FCA. Under the legislation, regulators are required to have the cost of any changes in relevant regulations verified by the Regulatory Policy Committee. This builds upon existing requirements within FSMA, which require us to conduct cost-benefit-analyses when we consult on new policy.

Payment Protection Insurance (PPI)

The current complaints framework and our supporting supervisory work has so far resulted in over £22.2 billion redress being paid to over 12 million customers. 

At the end of 2015, we published a consultation paper which proposed to set a deadline for making PPI complaints and to run a high-profile communications campaign telling consumers about it and signposting how to complain. Our consultation also proposed new rules and guidance for firms on handling PPI complaints after the Supreme Court’s decision in the Plevin case.20 

In 2016/17, we will consider the responses to the consultation, decide our final approach and, if appropriate, publish a Policy Statement. We will also continue to monitor and challenge firms to ensure that they continue to deal fairly and promptly with PPI complaints.

Prudential regulation

This year, our prudential work will focus on the continued implementation of the Capital Requirements Directive IV (CRD IV). We will be implementing changes to our Supervisory Review and Evaluation Process (SREP) to meet the European Banking Authority’s (EBA) new guidelines that come into effect in 2016. 

Other areas of focus will include implementing the Recovery and Resolution Directive (RRD) and helping firms to improve their wind-down planning in the event of a firm failing. 

We will continue to ensure firms have appropriate mechanisms to protect client assets to ensure consumers are protected in the event of failure.

Ring-fencing

After the financial crisis, the Government decided to ring- fence core banking activities from other activities. This is to make it easier and less expensive to resolve banks which get into financial difficulty, and reduce the likelihood of disruption to key services provided by the largest retail banks. 

The PRA is the lead regulator for implementing ring- fencing. We have key responsibilities for implementing the regime effectively and we will continue to work with firms as they finalise their plans for ring-fencing. 

We will monitor and manage any potential negative impacts of ring-fencing on consumers, market integrity and competition.