FCA and PRA launch support unit for new banks
The Financial Conduct Authority and the Prudential Regulatory Authority have set up a unit to help challenger banks navigate regulation.
The New Bank Start-up Unit will have a standalone website, telephone number and email address and draw staff from both the PRA and the FCA. It will provide named case officers during authorisation, access to a helpline, regular capital and liquidity reviews if appropriate and invitations to events focusing on regulation.
Currently UK banking is dominated by Barclays, Lloyds Banking Group, Royal Bank of Scotland, HSBC and Santander.
Tracey McDermott, acting chief executive of the FCA, said: “The New Bank Start-Up Unit will help those who want to start a new bank in the UK navigate the regulatory process.
“Increasing competition in the banking sector is important for consumers and the new unit will offer firms an accessible way to find the information they need to get themselves authorised.”
New banks wanting to enter the mortgage market have had to cope with a slew of regulation in the past few years. In April 2014 the Mortgage Market Review introduced stringent affordability stress testing and from March 2016 the Mortgage Credit Directive will introduce buy-to-let and second charge regulation in addition to new documentation.
Andrew Bailey, chief executive of the PRA, said: “These new banks are a key part of bringing innovation to the sector, particularly where there is a gap in the market – whether it is the service they provide, the customers they target, the products they sell or the technology they use.
“With the launch of the New Bank Start-up Unit, applicants will now benefit from having a single place where they can get the advice and guidance they need to start a new bank and support once they are authorised.”