FSA announces distribution review
It wants to understand better how its requirements can act as barriers or facilitators to the emergence of a market which is economically sustainable, attracts scarce capital and talent and is able to meet the changing needs of consumers from across the socio-economic spectrum. Its provisional aim is to publish the findings and conclusions of the work in the second quarter of next year.
John Tiner, chief executive of the FSA, speaking at the Retail Intermediaries Sector Conference, said:
“The FSA continues to believe that there is a crucial role for advice in the UK, especially as individuals are having to take more responsibility for financial planning.
“We believe that there are serious challenges to be faced in the retail intermediaries sector, from growing economic and market pressures as well as from complying with regulatory standards. Together, these may or may not affect sustainability or drive changes to market structure.
“We believe that this review will need to include participation by the Trade Associations, representing product providers, distributors and advisers – where we recognise that there is already work of this nature underway – and, of course, their members. I want us to try and reach a collective understanding of what the drivers of structural change might be and how they might reshape the market: for example, drivers such as regulation, customer needs, remuneration models, capital constraints, IFA demographics. We need to understand the consequences of new or emerging market structures for consumers, firms and the FSA and to understand the steps the industry and/or the regulator should be taking to secure a market place which is economically sustainable, attracts scarce capital and talent and which is able to meet the changing needs of consumers from the socio-economic spectrum.”