How to deal with a transforming FCA: Wind-down Planning

Series: How to deal with a transforming FCA

Topic: Wind-down Planning

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In our third webinar in our series that examines the FCA and its ‘Transformation Programme’, we discussed the FCA’s increased focus on wind-down plans. As part of a pledge to make its standards higher, the FCA promised a more intensive assessment and greater scrutiny of firms’ financials and we are certainly seeing evidence of that at Cosegic. Currently, the FCA is assessing firms’ wind-down plans with more scrutiny than ever before, whether it be in a firm’s application for authorisation, or as part of an s165 request.

In this webinar we looked at why the FCA has increased its focus on wind-down plans and provided guidance as to how to best approach a wind-down plan, so it can withstand the FCA’s increased scrutiny.

Agenda:

• Introduction to Wind Down Planning – what’s the objective?

• Overview of wind-down planning requirements

• Common Issues

• ‘How to guide’ – conducting wind-down planning

• Panel Session

Regulatory Background

Wind-down planning has become an increasing area of focus for the FCA. Whilst wind-down planning is a regulatory requirement for MIFIDPRU Investment firms, the regulator has made clear that its Wind Down Planning Guide (‘WDPG’) and its final guidance FG20/1: Assessing adequate financial resources, applies to all firms. Moreover, the FCA’s updated approach to regulating payments firms, Payment Services and Electronic Money – Our Approach (November 2021), also set out the requirement that all payments firms seeking authorisation need to develop a wind-down plan.

Consequently, it’s clear the FCA’s view is that all regulated firms need to understand how they would wind down their business in practice, and the financial and non-financial resources they require to ensure that their exit from the market does not result in harm. Further, the FCA recently published the results of its thematic review into wind-down planning, TR22/1 Observations on wind-down planning: liquidity, triggers & intragroup dependencies, which highlighted a widespread weakness amongst firms’ wind-down planning and set out the need for firms to revisit their wind down planning process and the quality of their documentation.

Speakers:

James Borley: Managing Director, Payment Services

Harpartap Singh: Managing Director, Prudential Services

Jonathan Aseervatham: Director, Prudential Services

Stefan Babic: Senior Consultant, Prudential Services