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March 2020 | AMI

Robert Sinclair: A little top heavy

Robert Sinclair is chief executive officer of AMI

The long-awaited Policy Statement on Mortgage Advice and Selling Standards has now been published by the FCA.

Whilst the policy changes came into effect from 31 January there are transitional provisions that run to 30 July 2020 which allows firms to defer application. 

As the FCA has grown its staff to almost 4,000 people it has also subtly changed shape. In addition to the chair and chief executive it has evolved a number of divisions within its structure.

  • Strategy & Competition
  • Supervision – Investment, Wholesale & Specialists
  • Supervision – Retail & Authorisations
  • Enforcement & Market Oversight
  • Operations 
  • To operate and manage these the FCA has appointed 34 directors and 84 heads of departments to provide leadership and direction for the markets it regulates. 

What is important to remember is that the significant prudential risks are all supervised by the PRA, with the FCA focussed on consumer based competition and conduct.

What may astonish most in our industry is that there are also 408 managers and 315 technical specialists. 

The total of 844 people in these senior roles is a significant overhead. This has happened swiftly over the seven years since creation. 

I can remember when there were only a very small number of technical specialists. This then leaves the remaining 3,100 people doing the real day job as senior associates and associates, as well as administrators.  The FCA operates with an average salary and pension cost of £80k per annum per person, with most directors earning more than £240k per annum, therefore this has to be seen as a regulator staffed by competent people. 

However, they also managed to accrue almost 26,000 sick days last year, over six days each on average. Supervising our industry must be very stressful. As AMI we continue to challenge the growing costs of the FCA where they continue to add to their agenda without adequately prioritising their issues or dropping items off the table. 

We will continue to challenge activity such as mortgage execution only which will diminish consumer protection and ensure that those new firms authorised genuinely put the consumer first.