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FSA: RDR not 'done deal'

30 November, 2007

Speaking at the Mortgage Masters conference, the FSA's director of small firms, Stephen Bland said that whilst automatic adoption was not the case, any feedback which hinted at possible wider improvements would be considered by the 'open minded' regulator.

Bland also suggested that in future, the mortgage market would be able to take its own lead in resolving any similar problems without waiting for the FSA to intervene.

"We began the Retail Distribution Review looking at investment because we found - and others agreed - that the market wasn't working efficiently," he said.

"Currently...the mainstream mortgage market...appears a more complete market. But there are serious issues for both individual brokers and the market as a whole to address both in the current market and looking ahead to possible future developments.

"I see this as being in the hands of you, the industry, so that market failures are addressed by industry solutions in the first instances and regulatory intervention is reserved for those failures that cannot be addressed, or have not been addressed by the market itself when it had sufficient opportunity to do so."

He told the audience that firms from across the retail market may choose to apply ideas put forward in the RDR Discussion Paper, published in June, to other types of business.

Highlighting some of the main drivers for launching the RDR, Bland drew a number of comparisons with the mortgage market to emphasise that the two markets are not the same.

Stephen concluded that there are issues in the mortgage market that need addressing, but whether the solutions found for the investment market in the RDR would apply was open for debate.