A raft of measures designed to support the growth of the mutuals
sector have been announced today by the financial regulators.
They include a review of credit union regulations and the launch
of a Mutual Societies Development Unit by the Financial Conduct
Authority (FCA).
The proposals form part of a package
of initiatives, published in a joint report from the Prudential
Regulation Authority (PRA) and FCA.
These
include:
-
A new FCA Mutual Societies
Development Unit that will act as a central hub of expertise
and insight helping mutuals navigate policy and legislative
changes. It will support initiatives such as co-operative
networks that enable mutuals to collaborate, grow and build
resilience.
-
A PRA and FCA review of mutual
credit union regulations, considering more risk-based capital
requirements for larger, complex firms and proportionality for
smaller credit unions.
-
Free pre-application support by the
FCA for firms setting up as a mutual society, innovating their
business models, or seeking guidance applying for targeted
support permission.
-
A cut in application times for new
societies – from 15 to 10 working
days,encouraging more society
registrations through the FCA's Mutuals Society
Portal.
-
Confirmation from the PRA that the
Building Societies Sourcebook has been removed from the PRA
rulebook with immediate effect.
Sam Woods, CEO of the PRA and
deputy governor at the Bank of England, said:
“Mutuals are a vital part of our
financial system. Today's report examines how the financial
mutuals sector is growing, and what we can do to help it thrive
in the period ahead.”
The FCA has also published its own
report as registering authority assessing the mutual societies
sectors.
, chief executive of the FCA,
said:
“The mutuals sector is remarkably
diverse and rooted in the communities and members it serves. They
support people to buy a home, insure against the worst events,
increase financial inclusion and bring communities together,
whether in the club, pub or on an allotment. We want to help them
grow, and our new Development Unit will provide dedicated
support. We're also making it faster for mutuals to
start-up.”
, Economic Secretary to the
Treasury, said:
“We have committed to double the size of the mutuals sector, and
are pleased the regulators are taking concrete steps to support
the sector's growth so it can deliver better value for members
and communities.
"Mutuals form an important part of the UK's financial and
business landscape, supporting the savings, borrowing, pensions
and more of millions of people.”
Today's announcements build on
existing regulatory initiatives to support mutuals and the wider
financial sector, including:
-
The regulators' joint proposals to
streamline the Senior Managers and Certification Regime to
support competitiveness.
-
The launch of the Scale-up Unit,
providing tailored support to firms with growth
ambitions.
-
The PRA's Strong and Simple rules,
which simplify capital requirements for smaller
firms.
-
The PRA's introduction of Solvency
UK, which significantly cuts red tape for insurance
firms.
-
The FCA's mortgage market reforms,
taken up by 85% of the market including building societies,
with lenders being able to
offer around £30,000 more.
Mutuals are owned by their members,
typically to serve their owners' needs and financial mutuals have
over 30 million members across the UK. This includes 93 mutual
insurance firms, 42 building societies and 350 credit
unions.
There are also 12 million memberships
across over 8,400 co-operative and community benefit societies.
Collectively, these hold more than £223bn in assets and include
housing associations, social clubs and retail
societies.
The reports were launched at an FCA
and PRA event on Friday 5 December in Rochdale, attended by
Economic Secretary to the Treasury MP.
