The UK’s new regulatory regime came into force on 1 April 2013. On that date, the former Financial Services Authority (‘FSA’) was dissolved and responsibility for financial regulation and supervision was transferred to two new regulatory bodies: the Prudential Regulatory Authority (‘PRA’) and the Financial Conduct Authority (‘FCA’).
The PRA is a subsidiary of the Bank of England and is responsible for the prudential regulation and supervision of banks, insurers, building societies, credit unions and major investment firms. One of its stated statutory objectives is specific to insurers in that it aims to secure adequate protection for policyholders.
The FCA will monitor conduct of business rules. It will also assume prudential supervision of those firms not regulated by the PRA, which include financial advisers and asset managers.
A new entity called the Financial Policy Committee (‘FPC’) has also been established. The FPC will have responsibility for horizon scanning for systemic risk, and will sit within the Bank of the England.