2017年-FCA英国金融行为监管局_embedding_the_mortgage_market_review_advice_and_distribution_2页_111kb

Summary of Regulator Assessment: Qualifying Regulatory Provisions

Document Overview

The document outlines the FCA's thematic review (TR15/9) on the implementation of the Mortgage Market Review (MMR) advice and distribution rules. The assessment was conducted as part of the FCA's ongoing efforts to ensure the mortgage market operates effectively for consumers and is suitable for all participants. The review commenced in July 2014 and findings were published in July 2015. The assessment was carried out by the FCA, which is the lead regulator for this initiative.

Core Content

• Title of Proposal: TR15/9: Embedding the Mortgage Market Review: Advice and Distribution.
• Lead Regulator: Financial Conduct Authority (FCA).
• Date of Assessment: 21 September 2016.
• Commencement Date: The thematic review began in July 2014, with findings published in July 2015.
• Origin: The MMR was developed domestically but with an awareness of the EU's Mortgage Credit Directive (MCD). However, it did not originate from the EU.
• Scope: The review applies to the entire UK and affects all firms that provide mortgage advice, including mortgage lenders, intermediaries, and equity release advisers. It is estimated that approximately 6,000 firms are affected.

Main Points of the Review

• The MMR was implemented through changes to the FCA's Mortgage Conduct of Business (MCOB) rules, which came into force on 26 April 2014.
• The thematic review assessed how firms had embedded the MMR advice and distribution rules into their operations.
• The review focused on the customer experience of receiving mortgage advice and whether firms were recommending mortgages that were suitable for individual customer needs and circumstances.
• The findings were based on consumer research, mystery shopping, file reviews, and firm visits.

Key Findings and Implications

• The review did not introduce new expectations but emphasized the importance of adhering to existing MMR rules.
• It identified areas where firms' interpretations of the rules led to unintended consequences and highlighted examples of better-performing firms.
• It also noted instances of non-compliance with existing rules, which could have resulted in regulatory action or reputational damage.
• The review aimed to improve process efficiencies and customer experience by promoting clarity and better adherence to the rules.

Cost and Benefit Analysis

Likely Costs to Firms

• The thematic review itself did not impose new costs but reminded firms of existing obligations.
• Costs, if any, were associated with non-compliance with pre-existing rules, such as:
  • Additional staff training
  • Changes to processes and procedures
  • System modifications (limited to process improvements or development of Management Information)
  • Adjustments to oversight processes
• These costs were assumed to have been incurred prior to the implementation of the MMR rules in April 2014 and were therefore not considered in the current assessment.
• As a result, the estimated net cost to business is zero.

Likely Benefits to Firms

• Clarity and Efficiency: Improved clarity in the rules may allow firms to streamline processes, reducing duplication and repetition, which can lead to better customer experience and fewer complaints.
• Resource Optimization: Advisers may have more time and resources to assist customers, potentially leading to cost savings and increased business.
• Process Improvement: Some firms had already identified issues and were embedding new processes, so the publication of findings may assist in further improvements.
• Avoiding Regulatory Action: Addressing areas of non-compliance can help firms avoid potential regulatory action or reputational damage.

Additional Information

• The FCA previously reported in PS/16 that the total ongoing compliance costs for MMR proposals were expected to range between £49m and £172m annually, while one-off costs were expected to be between £42m and £67m.
• The BIT score for the policy was assessed as 0, indicating no significant impact on business costs.

Conclusion

The thematic review TR15/9 was aimed at evaluating the implementation of MMR rules across the UK mortgage sector. It did not introduce new regulatory expectations but served as a reminder of existing obligations. The review identified both areas of concern and best practices, with the goal of improving consumer outcomes and ensuring firms operate in a compliant and efficient manner. While no new costs were associated with the review, the findings could lead to long-term benefits for firms through process optimization and risk mitigation.