Update on Bank of England and FCA Memorandum of Understanding on the supervision of market infrastructure and payment systems

Domestically, the Bank of England co-operates with both the FCA and Payment Systems Regulator (PSR) in relation to supervising market infrastructure and payment systems respectively.

The frameworks for co-operation with these authorities are set out in 2 memoranda of understanding (MoUs) which the signatories are required to review annually, including by seeking feedback from supervised firms. Co-operation supports effective supervision and policy making by sharing information between the regulators and promotes efficiency by minimising duplication on the financial market infrastructures (FMIs).

The Bank and FCA held a consultation with FMIs and reviewed their co-operation regarding market infrastructure – seeking in particular feedback on how the authorities had co-operated during the coronavirus (Covid-19) market events of Spring 2020. The authorities concluded that the MoU’s arrangements for co-operation remain effective, with appropriate co-ordination and no material duplication. Industry respondents acknowledged the efforts made on co-operation and the Bank and FCA remain committed to effective co-operation.

The authorities recognise that policy co-operation will be even more important from 2021 as a result of the UK leaving the European Union. The authorities re-affirmed their commitment to co-operate domestically and internationally to ensure sound rulemaking that reflects awareness of each others’ objectives.

MoU on Bank of England website