The number of authorisations for retail firms approved by the FCA fell sharply in the second quarter of 2014, which the regulator says is down to a number of high risk cases taking up resource.
Quarterly key performance indicator data, published by the FCA yesterday, shows 120 retail firms were either authorised, or authorised subject to certain conditions being met, in Q2 2014.
This is down by 38 per cent compared to 192 approvals in Q2 2013, and down by 24 per cent compared to the previous quarter.
The FCA says the fall is “due to a number of high risk cases taking up a lot of time and resources”.
The average time to process a retail application for authorisation rose slightly on a quarterly basis, from 13.1 weeks in Q1 2014 to 13.7 weeks in Q2 2014.
This remains significantly lower, however, than the average processing time of 17 weeks in Q2 2013.
The FCA says that although processing times are rising, it is still able to “quickly progress good quality applications from firms that are ready, willing and organised”. Its minimum processing time in Q2 2014 was two weeks.
The average time taken by the FCA to process applications by retail firms to vary their permissions increased over the period, from 7.6 weeks in Q2 2013 to 11 weeks in Q2 2014.
The regulator says this is because it dealt with a large number of higher risk cases in Q2 2014.
The FCA has also seen an increase in applications for rule waivers. The regulator has the power to waive or modify handbook rules and will do so if a firm can demonstrate that complying with the rule would be unduly burdensome or not achieve its purpose, and if granting the waiver will not adversely affect any of its operational objectives.
The number of applications for waivers rose from 37 in Q2 2013 to 60 in Q2 2014.
The FCA says it has seen a rise in the number of waiver requests relating to the capital requirements directive, which applies to banks and building societies.