The Financial Conduct Authority (FCA) is increasing scrutiny of regulatory applications from new firms.
The City regulator’s latest quarterly authorisations data for January to March 2023 showed that the number of new firm applicants that were not authorised in 2021/22 was one in five. This was up from one in 14 in the previous financial year, which has continued through 2022/23.
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The FCA also said that it wants firms to be able to better predict how long it will take for their application to be determined. Previously, it only reported on the proportion of cases determined within statutory deadlines.
“To increase transparency, we are now publishing the lower quartile, median, and upper quartile of the range of calendar days taken for determination in each category of application,” the FCA said. “This shows that most applications are determined significantly ahead of the statutory deadline. Complete and comprehensive applications are likely to be determined in good time.”
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The FCA now publishes quarterly data on is authorisation metrics to show how progress is being made.
The latest quarterly data showed that 94.8 per cent of new firm applications were assessed within six to 12 months – this was up from 93.5 per cent the previous quarter but down from 97.8 per cent over 2021/22.
“The data for the final quarter of 22/23 shows we continue to make progress towards meeting our service level targets,” the FCA said. “Our performance against eight metrics is green, amber for five and three metrics are red.
“The metrics, necessarily, involve a time lag so do not reflect current performance and we expect to see further improvements.”
One area where the regulator’s performance fell down in the last quarter was in processing appointed representative-related applications for an ‘approved person’ status.
This was due to a large number of applications being submitted by an applicant without the necessary permissions, the FCA said. The applicant subsequently withdrew the application for permissions and the associated approved person applications after the deadline. Without those applications the performance would have been around 95 per cent (amber).
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