The FCA is to issue a survey to approximately 13,000 solo-regulated firms this week requesting information on their financial resilience.
Responding to this request will not be voluntary for these firms as the FCA will be using its powers under section 165 of The Financial Services and Markets Act 2000 (“FSMA”) to require firms to respond.
The relevant 15 sectors are
Each of these firms is to receive an initial email, introducing the survey. The survey will then be issued in two groups:
The FCA anticipates that the 10-question survey will take approximately an hour to complete. Only time will tell if this proves to be optimistic on the FCA’s behalf due to the nature of the responses being required. Questions will cover matters including liquidity positions and safeguarded assets, as well as other financial data. We understand that the FCA will use the information to formulate a view of financial resilience during the pandemic. However, firms should be under no illusion that the FCA will not seek further information or consider intervention concerning firms should their responses to the survey raise concerns with the FCA regarding individual firms’ or a sector’s financial stability, including whether firms are able to meet their ongoing regulatory obligations.
The survey link will be issued to a specific named person within each firm, via a mobile app. It will not be on Gabriel. All firms in the in-scope sectors are expected to complete the survey, unless the required information has already been provided in a recent submission. Completion of the survey is mandatory, on a best efforts basis. We understand the FCA will not publish the details provided to it in response to the survey.
It is key to note that the FCA anticipates that it will repeat the survey on a periodic basis and could also widen the scope. The detail of any future surveys will be determined at a later date but this is a key area of focus for the FCA during the current challenging economic climate. Firms should expect that any follow up may well include testing whether projections or predictions of future resilience were accurate or reasonable. Again, this may lead to the FCA challenging individual firms and their senior management on both the responses provided and their current financial resilience.
It is vital that firms, when responding to the FCA’s information requirement, ensure they fully consider the potential impact of the information provided to the FCA, how the FCA may interpret it and above all else ensure its accuracy. The FCA has illustrated on an ongoing basis how it will intervene if it receives inaccurate information or is concerned about the financial resilience of firms. Similarly, the FCA will not be reticent to hold senior management accountable in this regard.
This publication is intended for general guidance and represents our understanding of the relevant law and practice as at June 2020. Specific advice should be sought for specific cases. For more information see our terms & conditions
Consumer Finance: Hot Topics for 2020Read more
The future of cash savings in 2021Read more
APP fraud: Court hands down judgment on the extent of the Quincecare...Read more
Beyond BrexitRead more
Mortgage and home finance regulation in 2021Read more
Financial services investigations and enforcement monthly round up -...Read more
TLT advises Thrive on first commercial rooftop solar initiativeRead more
TLT supports Low Carbon develop UK's largest community-owned solar...Read more
TLT wins Best Law Firm at Car Finance AwardsRead more
The widespread disruption and closure of businesses caused by the Covid-19 pandemic and the subsequent national and local lockdowns has brought into sharp focus the question of available insurance cover for losses under...Read more
Helping you navigate your business through the risks and opportunities that Brexit will bring.Read more
Watch our video series for information on the legal issues that are affecting the real estate sector. Each...Read more
The way people shop is constantly evolving, from the growth of online and the changing use of stores...Read more
The pandemic has had a deep and long-lasting effect on the leisure, food & drink sector, forcing operators to embrace new ways of attracting and servicing customers.Read more
The pandemic has forced the majority of the workforce into a world of remote working. As a result, our cities are evolving.Read more
Our countdown to Brexit and beyond podcast series looks at the impact for businesses on both sides of the pond of any free trade agreement between the UK and Europe and the UK and the US. ThisRead more
There's a growing demand for retailers to do more to attract the Purple Pound – the collective spending power of disabled shoppers, estimated to be worth around £274bn. We look at the opportunities, the legal issues and...Read more
Green finance is gaining speed, driven by global climate change pressures and the recognition of the vital role which sustainability plays in a resilient financial services sector.Read more
Working with UK and international banks on domestic and cross-border debt finance activity.Read more
Providing a complete service covering all aspects of regulatory law.Read more
Guidance on every aspect of regulatory change and all types of regulatory issues to clients ranging from retail banks to insurance and credit brokers, sub-prime lenders, credit providers and payment service providers.Read more