The summary includes consultation/policy papers and speeches published by the regulators and other bodies, as well as articles that may be of interest. It is not intended to be an exhaustive list of all matters relevant to financial services.  

Please refer to the relevant organisations’ website for a complete record of their publications and news releases.

On 2 August the Treasury published its response to its January 2023 consultation on a resolution regime for insurers. The Treasury reported that "overall, respondents were supportive of the proposed introduction of the UK resolution regime for insurers and were broadly in agreement with the proposed framework, noting support for the introduction of a regime aligned to international standards and guidance". The government will legislate for the proposals when Parliamentary time allows

On 7 August the Treasury published its response to its September 2022 consultation proposing reform of the Bank of England's systemic payments perimeter. The consultation was in response to the changes to the payment environment since the Banking Act 2009 came into force, and in recognition that it continues to evolve (eg the steps in the payments process continue to unbundle with new activities and services developing and growing). The government reports that respondents to the consultation were largely positive about reform of the perimeter (eg introduce a new category of service provider, removal of non-payment critical third parties given a new regime in FSMA 2023). The government will however explain its approach whether to extend the SM&CR regime to systemic payment entities, after a broader review of SM&CR has concluded. Other proposals are already being implemented (eg new powers for the FCA / PSR in relation to retained EU law within their remit).

On 7 August the Treasury published the terms of reference of a Central Bank Digital Currency (CBDC) Taskforce. The stated purpose of the Taskforce is to ensure a strategic approach and to promote close coordination between the UK authorities as they explore a CBDC. No decision has yet been made whether to introduce a UK CBDC - the government and the Bank will engage widely with stakeholders on the benefits and risks before deciding.

On 10 August the Treasury published a mortgage charter: a set of standards or commitments that principal mortgage lenders have agreed with the FCA and government. The charter follows meetings between the chancellor, lenders and the FCA in December 2022 and June 2023, and concerns about the effects of rising interest rates on mortgage holders. The commitments include various offers of help, guidance and support for struggling customers; that borrowers will not be forced from their home in less than a year from their first missed payment; the ability to lock in a new deal 6 months ahead of a fixed deal ending; and that customers up to date with payments may switch to interest only for 6 months, or extend the term (with the option to revert back within 6 months). The signatories to the charter cover about 90% of the UK mortgage market. Please read the charter for the precise details - for example buy to let mortgages are not covered.

On 18 August HM Treasury published its Cash Access Policy Statement (required by s.131P of FSMA 2000). While the number of physical cash payments has fallen to around 15% of the total over the last decade, cash remains important to many people. The statement sets out the government's policy - broadly to maintain reasonable access to deposit and withdrawal services for personal and business current accounts. The two main measures of reasonable are to maintain the current distribution of access across the UK (eg within 1 mile in urban areas) and free access for personal account holders. The FCA has been handed a new function to ensure reasonable access to cash, and new powers to monitor access and take action if required (see also below for the FCA response).

On 31 August the Bank published the CBDC Technology Forum minutes for the July 2023 meeting. The Bank explained it was at the start of a two-to-three-year design phase, after which a decision would be taken whether to proceed to build the architecture.

August was a month in which the Bank published a number of interesting papers and posts, including:

• Enabling innovation through a digital pound explored how developing the digital pound could promote innovation in the payments space, thereby improving efficiencies and choices for users. The paper identified four themes under which innovation could be promoted: the choice of technology; convening a new market; providing data; and setting standards.
• Bank expectations and prudential outcomes analysed the regulatory returns collected by the prudential regulator (the FSA and the PRA) to assess how good banks’ expectations or forecasts were. The paper’s findings include that banks were generally optimistic, that better managed banks had smaller forecast errors, and that higher errors were associated with subsequent lower loan growth.
• Macroprudential stresstest models: a survey of the rapidly developing literature on macroprudential stress testing models. 

On 3 August the FCA set out four themes to form the basis of its joint review with the Treasury of the Advice Guidance Boundary. The FCA also announced it would wrap its work on a core investment advice regime into the review; and provided a clarification for firms about the current framework, pending any new regime post review.

On 9 August the FCA launched the latest campaign to help consumers spot and avoid loan fee fraud. Loan fee fraud has been growing year on year and typically results in a £260 loss per case. This year, the rising cost-of-living coupled with summer spending pressures could increase the risk of loan fee fraud. The FCA sets out a 3-step check for consumers to protect themselves from scams: 1) If you are cold called or emailed, it could be a scam; 2) If you’re asked to pay an upfront fee, it could be a scam; and 3) If you’re asked to pay quickly or unusually, it could be a scam. The FCA also urges consumers to check information on its website - if the firm that has contacted them or that they might be applying to is not authorised, it is likely to be a scam. 

On 10 August the FCA published the results from a targeted review carried out in the last year, to examine how Authorised fund managers' assessments of value have been implemented. The FCA findings are that many firms have a better understanding of the rules and have now fully integrated considerations on assessment of value into their product development and fund governance processes, which has resulted cost savings for consumers. But there remain outliers, where action needs to be taken – eg firms who were not able to support their assumptions and assessments with sufficient evidence. The COLL rules require firms to assess whether firms’ fees and charges (referred to collectively as 'fees') are justified by the value provided to fund investors, measured against the rules’ minimum considerations (referred to as ‘considerations’). 

On 15 August the FCA set out its approach to reviewing how financial services firms are applying the Politically Exposed Persons’ regime (PEPs) and whether its guidance needs updating. It has written to various UK PEPs inviting them to share their experience; it will publish the terms of ref of its review in September, and report back next by June 2024.

On 18 August, alongside the government's Cash Access Policy Statement (see above), the FCA set out its approach to ensure reasonable provision of cash deposit and withdrawal services for personal and business current accounts in the UK or part of the UK. The FCA’s current assessment is that most people's access to cash is good. The FCA approach is: 1) to maintain a network of cash access facilities that is in keeping with the current distribution of services so that people and businesses who remain reliant on cash are able to withdraw and deposit it; 2) to consult on rules that will require each of the banks and building societies designated by the Government as subject to the new access to cash regime to conduct assessments of the reasonableness of cash provision when certain significant changes in local access occur or are proposed; 3) to monitor coverage of access to cash across the UK, we also expect to use our new powers to collect information from providers of cash access services and other entities involved in cash access services; 4 an expectation that if an assessment shows additional cash services should be put in place as a result of a pending closure by a designated firm, the closure must wait until those services are in place. The FCA expects any new rules to have effect by Summer 2024.

On 31 August the FCA published an update report on its wholesale data market study (launched in March 2023). The study is focused on i) competition in the provision of benchmarks, ii) credit ratings data and iii) market data vendor (MDV) services. The FCA at this stage does not propose to refer any of the three markets to the CMA and is consulting on this decision. While the FCA notes that there are reasonable grounds to believe certain features of each of the markets are anti-competitive, its provisional view is that the appropriate course of action is for it, the FCA, to take forward further work to mitigate the harms caused. The FCA indicates it is on track to publish the final report by 1 March 2024.