6 May 2020: the Financial Conduct Authority (FCA) and Financial Ombudsman Service (FOS) have provided additional clarity for banks and SMEs regarding the two government loan schemes available during the coronavirus crisis.
Coronavirus and financial services
Guidance and insights from ICAEW, regulators and other resources on how the financial services sector is responding to the coronavirus COVID-19 pandemic.
4 May 2020: Philippa Kelly, Director of ICAEW’s Technical Strategy Business Group, outlines what SMEs may stand to gain from the Financial Conduct Authority’s announcement on insurance cover.
28 April 2020: the heads of the UK’s financial regulatory bodies are balancing the efficacy of the mass government lending schemes to the economy with risks like fraud and business failure
Stress testing is an important tool that is used by regulators for an increasingly wider set of firms. This webinar will help you understand the latest rules and how they work with the latest accounting standard, IFRS 9.
23 April 2020: challenger banks would have been better equipped to distribute government funding, an expert industry banking panel has reported, although scale would have been an issue.
30 April 2020: the heads of the Financial Conduct Authority have written to the chief executive officers of banks over conduct when lending to corporate businesses.
The subjective nature of IFRS 9 Financial Instruments means banks are facing difficult decisions when it comes to applying the standard in a world grappling with the health and economic impacts of coronavirus.
COVID-19 raises a range of financial services issues which firms and businesses will be managing through over the next weeks and months.
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Vincent Huck, editor of Insurance Asset Risk, looks at the technical challenges that the insurance market is facing in light of the COVID-19 pandemic.
1 April 2020: the European Central Bank (ECB) has asked banks in Europe to suspend dividends and share buybacks until October.
The Sunday Times economics editor David Smith looks at the effect that pandemics have on economies and the challenge of coronavirus.
22 May 2020: As the Bank of England lays the groundwork for a potential move to negative interest rates in response to COVID-19, we consider five key issues for financial services in a negative interest rate environment.
Guidance from regulators
Payment holidays in the age of Covid: Implications for loan valuations, market trust and financial stability
Paper produced by the Financial Stability Institute (FSI) examining payment deferral programmes introduced by governments and banks around the world during the coronavirus pandemic. It gives an overview of measures in different jurisdictions, discusses the accounting treatment of payment holidays under IFRS 9, and considers the practical issues regarding the spectrum of affected borrowers between solvent, illiquid and insolvent.
Paper produced by the Financial Stability Institute (FSI) comparing the measures introduced in several jurisdictions to influence how ECL methodologies can be applied under the current COVID-19 pandemic and reviewing the cumulative impact of these measures on a bank's financial metrics.
The European Securities and Markets Authority's (ESMA) updated risk dashboard shows large equity market corrections since mid-February 2020, with corporate bond, government bond markets and a number of investment funds also under stress. Market infrastructures have however continued to function normally despite significant surges in trading activity, the use of circuit breakers and increases in derivatives margins.
Regularly updated information hub created by the UK's Financial Conduct Authority (FCA) providing news updates for firms and consumers.
Regularly updated page collecting the latest news and information for financial services firms from the FCA, with links to specific guidance. The page covers the FCA's expectations of payment and retail banking firms; SM&CR responsibilities; regulatory change; impact on consumers; insurance products; mortgages; unsecured debt products; access to cash; operational resilience; market trading and reporting; delayed consultation papers and calls for input; delays to publications and other activity.
Guidance from the FCA for firms participating in the government's Coronavirus Business Interruption Loan Scheme on assessing the affordability of loans, stating that lenders may take into account appropriate evidence (including historic trading figures as well as future forecasts) and that lenders should consider deferring repayments if forecast income does not materialise.
Guidance from the FCA for insurance firms highlighting specific issues regarding operational resilience and business continuity, travel insurance, motor and home insurance, guidance on MOTs, private medical insurance, product suspension, renewals, mid-term adjustments, and expectations of brokers. It reminds insurers to consider very carefully the needs of their customers and show flexibility in their treatment of them.
Guidance from the FCA for mortgage lenders, mortgage administrators, home purchase providers and home purchase administrators. The advice focuses on payment holidays and repossessions, stating that lenders should grant customers experiencing difficulties a payment holiday for an initial three-month period and ensure that there is no additional fee or charge (other than additional interest) as a result of the payment holiday.
Regulators urge savers to keep calm and not rush to make any decisions about their pension in response to the coronavirus (Covid-19) pandemic.
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