Mortgage regulation: challenges ahead The Mortgage

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The Mortgage & Protection Event 2017

Mortgage regulation: challenges ahead

Aileen Lees Senior Policy Adviser

November 2017

Time to keep winning

The challenges  Senior Managers and Certification Regime  Compensation scheme levies and structure  Mortgage market study  Ageing population in financial services

Senior Managers & Certification Regime  Approved Persons swept aside  Duty and Statement of responsibilities  Issues are allocating Senior Management Functions and who is in scope  Additional Prescribed Responsibilities  Firms to pre-vet and certify that staff in designated roles are fit and proper  To be renewed annually – criminal record and credit checks together with evidence of on-going competence

Senior Managers & Certification Regime  Also a certification regime and new conduct rules  Conduct rules do not introduce new principles  Firms should review the consultation to understand the scale of changes  Rules to be effective early 2019  A year to implement for larger firms will not be easy  AMI will provide templates and support to members

Senior Managers & Certification Regime Conduct Rules

All employees must…  act with integrity  act with due skill, care and diligence  be open and co-operative with regulators  pay due regard to customer interests  observe proper standards of market conduct

Financial Services Compensation Scheme (FSCS)     

Review of funding – including classes Claims in Life & Pensions and Mortgages AMI strongly supports separation of Life from Pensions Provider contributions proposed Changes effective 2018/19

Other regulatory work Mortgage market study  Looking at tools available to consumers (including advice) on effective decision making  Exploring if commercial arrangements lead to conflicts of interest or consumer detriment  Interim report due spring 2018 Ageing population  Analysis published September 2017  New “retirement interest-only mortgages”

In summary  Apportioning of responsibilities and personal accountability from 2019  Firms taking on more responsibilities and processes for their staff  Coming to an end of high compensation scheme fees  Where will advice sit in the regulatory landscape?

Questions?

AMI The trade body for the profession  Non-commercial, not-for-profit trade body, launched in April 2003  Role is to represent member firm’s interests to create a positive business environment for intermediaries  Work with UK Finance, BSA, IMLA and FLA to ensure cohesive industry responses  Liaise with FCA, FOS, FSCS and MAS as well as Treasury, DCLG and BEIS  It is AMI’s objective to play a critical but constructive role within the regulation process - offering insights from the "front line" of the market  Need members to fund our work