The plans will put in place three separate bodies, two under the auspices of the Bank of England, each with a distinct mandate and clear objectives.
The Financial Services Authority, as announced last year, will be disbanded though it will keep its current responsibilities throughout the transition period, moving to a new management structure for conduct and prudential regulation on 4 April.
Ultimately, the three new regulatory bodies will be:
- an independent Financial Policy Committee (FPC) in the Bank of England;
- a new Prudential Regulation Authority (PRA) as a subsidiary of the Bank of England;
- an independent conduct of business regulator, the Financial Conduct Authority (FCA), which had provisionally been called the Consumer Protection and Markets Authority.
The Treasury has published "A new approach to financial regulation: building a stronger system" which gives the full detail of the Government’s thinking.
The next stage is a Government White Paper including a draft Bill in the spring with legislation introduced into the current Parliamentary session. The new-look regulatory structure should be in place by the end of next year.
