Source · Select Committees · Treasury Committee
Recommendation 12
12
Acknowledged
Paragraph: 78
Publish clear instructions by Q3 2024 on permissible use of 'risk appetite' criteria
Conclusion
The FCA should continue their work into better understanding how financial institutions are using criteria like “reputational risk” or “risk appetite” and report their findings by the end of Q2 2024. It is essential that the FCA publish clear instructions by Q3 2024 to the market about how such criteria can and cannot be used within the existing regulations. These instructions should be designed to ensure consistency between institutions and prevent the above criteria from being applied more broadly than the law permits. HM Treasury should keep the findings and subsequent action taken by the FCA under review, and it should be prepared to widen the FCA’s remit as needed should the action taken not be robust enough under the current regulations.
Government Response Summary
The government stated its commitment to ensuring SMEs have appropriate access to redress and proportionate regulation but did not commit to the specific actions or timelines recommended for the FCA or HM Treasury.
Paragraph Reference:
78
Government Response
Acknowledged
HM Government
Acknowledged
14. The Government is committed to ensuring that SMEs have appropriate access to redress now and in the future, with proportionate regulation and oversight of business banking.