FCA framework for firms on assessing adequate financial resources

The FCA has published finalised guidance on its framework to help financial services firms ensure they have adequate financial resources and take effective steps to minimise harm to consumers and to markets. The FCA announcement of the guidance stated:

“Consumer confidence in financial services and the firms that provide them is vital, and ensuring the financial soundness of the firms and individuals we regulate is a key focus for the FCA. 

This is part of our broader approach to supervision and it aims to provide more clarity to the industry on: 

  • the role of adequate financial resources in minimising harm
  • the practices firms can adopt when assessing adequate financial resources
  • how we assess the adequacy of a firm’s financial resources 

Firms’ financial resilience may be under increased pressures due to coronavirus so it is important that they are taking appropriate steps to managing prudential risk and minimising potential harm to their customers.  We expect firms to assess that they have adequate financial resources that are proportionate to the risk of harm and complexity of their business.”

Important Note: ATEB news is intended to provide general information ONLY. The content, including any views expressed or guidance provided, does not replace the need to comply fully with FCA Rules and Guidance. Unless you have discussed news article content with ATEB, and specifically how it relates to your circumstances, then ATEB disclaims all liability and responsibility and actions arising from any reliance placed upon it. For the avoidance of doubt therefore, any reliance you place on such information without our consultation is at your own risk.

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Technical Manager - Often referred to as the Oracle or the Sage, Alistair has a wealth of financial services experience. He is our go-to Technical Manager and enjoys nothing more than a complicated conundrum. Feel free to test his renowned knowledge by getting in touch.

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