This is the first time the FSA has drawn on a £100m credit agreement with Lloyds, which was set up prior to the credit crunch. The regulator has also borrowed a further £100m from HSBC.
The FSA has also agreed a further loan from Lloyds to finance its expected deficit for the upcoming year.
The FSA board agreed the loans, but is now asking executive directors to review the regulator’s spending.
The Independent on Sunday says while the FSA’s average cash balance last year was £56m, it fell to £200,000 at the end of March, compared to £24.8m at the same time the year before.
An FSA spokesman says the regulator had to borrow the money to pay for its new Supervisory Enhancement Programme, which is being funded through this year’s fees.
He says: “The loan will be used to finance the cost of the SEP until we collect fees in full. We will pay back the loan when we are in a position to do so, we don’t have a timescale on that yet.”
Last week Money Marketing revealed that the FSA is currently owed £900,000 in outstanding fees by 1,692 regulated firms.
The figures were obtained through a Freedom of Information request. The FSA says this list includes firms that are in dispute over fees.