FSA has held a mortgage conference on 12 May.  

  • Lord Turner spoke on current issues. He said it is important to consider the relative merits of product, sales and firm-level regulation when deciding what regulatory changes to make. He looked at problems in the mortgage lending markets and why FSA has not taken immediate action to set maximum LTV or LTI ratios. He outlined FSA’s options for action and its main priorities;  
  • Dan Waters spoke on distribution. He looked at the significant role of brokers, particularly as a sales channel for high-risk products. He looked at whether these products benefited consumers. He also focused on non-advised sales which account for 30 per cent of sales, although most customers look to brokers for guidance. He moved on to lack of regulatory compliance by lenders and brokers and FSA’s thematic work, including on detection and prevention of mortgage fraud. Finally he said it is important to look at what the consumer wants and needs; and  
  • Jon Pain spoke on the way forward. He said FSA will publish a discussion paper in September and follow it with consultations on proposed rule changes. The paper will cover disclosure and reasons behind irresponsible lending. It will consider selfcertification and affordability. FSA is also looking at how to prevent securitisations being used as vehicles that allow lenders to take on unacceptable risk. Finally, the paper will consider arrears and repossession handling.