FCA Consults on Asset Management Regulation Update

To better
understand the needs of investors in the asset management (AM) industry, the
British Financial Conduct Authority (FCA) has <a href=”https://www.fca.org.uk/publications/discussion-papers/dp23-2-updating-and-improving-uk-regime-asset-management”>published</a>
a new <a href=”https://www.financemagnates.com/terms/r/regulation/” class=”terms__main-term” id=”341d154e-1396-4d12-a357-4837e79c4146″ target=”_blank”>regulation</a> paper titled ‘Updating and improving the UK regime for
asset management’. Interested parties can submit their comments and ideas by
22 May 2023.FCA Wants to Update Asset
Management LawsThe UK
firms manage over £11 trillion in assets, making the country a leading hub for
asset management. Through the Future Regulatory Framework, the assessment of the
future of the local financial services sector outside of the EU, the FCA has an
opportunity to enhance asset management regulation with a more modern and
customized system that effectively addresses the requirements of UK markets and
customers. The FCA
will ensure that any modifications are in harmony with global standards and
promote technological advancements and innovation.”The
UK has an opportunity to update and improve the UK regime for asset management.
We want to hear from a wide range of voices about how we can enhance the
existing standards, and what we should prioritise to bring the most benefits to
consumers, firms and the wider global economy,” Camille Blackburn, the Director
of Wholesale Buy-Side at FCA, commented.In its
latest publication, the FCA presents a broad array of concepts, such as how it
can facilitate firms in using technology to enhance customer efficiency and
experience. Additionally, it examines how the FCA’s regulations can be improved
to help companies deliver assistance to retail and wholesale investors, whether
based in the UK or internationally.At the
current level of work, the FCA has not yet approved any proposals, and it wants
to hear from stakeholders before doing so. The update to the AM rules is in
line with the regulator’s three-year strategy to promote growth in the quality
of local financial markets.Watch the recent FMLS22 panel on constructing collaboration between fintech, banks and asset management companies.With or Without the EU,
the UK Dominates the Asset Management IndustryAccording
to the Global City’s report published on October 2022, the UK still holds the
title of the top global center for <a href=”https://www.financemagnates.com/tag/asset-management/” target=”_blank” rel=”follow”>asset management</a>. As mentioned above, the
nation manages £11.6 trillion in assets, making it the second biggest global
<a href=”https://www.financemagnates.com/terms/h/hub/” class=”terms__secondary-term” id=”70df8dbe-6564-4e03-8d97-dec68acfd2ce” target=”_blank”>hub</a> after the US. The asset
management industry grew in 2021 by £600 billion (or 5%), while 37% of all
European assets are under the UK management. The country’s share in the AM
industry is more significant than the following three countries combined,
including France, Germany and Switzerland.”Given
the UK’s leading role as a centre for asset management, we want to make sure
our rules are fit for the future. We want a UK wholesale market which supports
the economy and is open to innovation, while remaining consistent with high
standards of consumer protection and market integrity,” Blackburn added.Additionally, the report
by Global City shows that the UK is a convenient location for overseas
investors, with 65% of UK investment fund managers’ assets based overseas.
Overseas clients account for £4.6 trillion of total assets under management. FCA on a Hiring Spree in
2022To better
serve the asset management and other financial services industries, the UK’s
regulator <a href=”https://www.financemagnates.com/forex/fca-adds-1000-employees-in-2022-as-scrutiny-increases/” target=”_blank” rel=”follow”>added 1,000 new officers in 2022</a>, opened an office in Leeds and
accelerated its expansion in Edinburgh.Meanwhile, at
the beginning of 2023, the FCA announced several significant personnel
decisions. At the beginning of February, the regulator <a href=”https://www.financemagnates.com/executives/fca-appoints-aidene-walsh-as-psr-chair/” target=”_blank” rel=”follow”>confirmed the
appointment of Aidene Walsh</a> as the Chair of the PSR (Payment Systems
Regulator). Welsh has served as the PSR’s Interim Chair since April and was
recently commissioned for a full three-year term.Additionally,
the regulator has <a href=”https://www.financemagnates.com/forex/fcas-financial-ombudsman-zahida-manzoor-to-serve-second-term/” target=”_blank” rel=”follow”>reappointed Baroness Zahida Manzoor</a> to lead the Financial
Ombudsman Service (FOS) as its Chair for a second term, which will run until
August 2025. The FOS has direct contact with consumers, and in 2022, it accepted
more than 73,000 complaints relating to the performance of financial services
and products.