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FSA relaxes reserve rule

The FSA is throwing a lifeline to providers to stop them being forced into selling equities to meet statutory reserves.

One of the FSA&#39s regulatory resilience tests which aims to ensure life offices have reserves to cover the possibility of a sharp stockmarket fall has been temporarily dropped.

The FSA says the scenario the test covers is no longer likely and it was concerned the tests could trigger unnecessary short-term equity sales.

Companies may be forced to sell equities to raise capital needed to meet reserve requirements which have increased with recent stockmarket falls. But the high volumes of sales have the effect of plunging the markets even lower.

FSA spokesman Vernon Everitt says: “The net effect is to relieve some of the pressure that life companies may have faced to make short-term changes to their investment portfolios.”


SG Life & Pensions – SG Life International Bond

Tuesday, 11 September 2001.Type: Traditional offshore bond.Aim: Growth by investing in a choice of three risk graded portfolios,cautious, balanced, aggressive or a self-select option with a choiceof 94 unit trusts, oeics, managed bond funds and investmenttrusts.Minimum investment: £50,000.Place of registration: Guernsey.Investment split: Choice of three risk graded portfolios, cautious,balanced, aggressive or a self-select option with […]

AMP appoints Moore as M&A head

AMP has appointed current director of finance Philip Moore as head of mergers and acquisitions to research global opportunities for expanding the business.Moore will lead a team that will work as part of the corporate strategy team to research global acquisition and merger opportunities, and will lead the execution of all major acquisitions or divestments.Moore […]

Rate cuts will protect UK housing market if recession hits

Interest rate cuts will protect the UK housing market from the impact of the terrorist attacks on New York’s World Trade Centre this week, say IFAs. Charcol and London & Country are among many mortgage brokers which believe the Bank of England will cut rates as early as next month to keep consumer confidence high […]

Outside edge

I recently had the benefit of a discussion with a senior person at IBM who used an analogy to explain that sudden change often provokes more action than when it is gradual. It concerned a frog sitting in his cold-water pond who jumps out when boiling water is poured in but remains in his pool […]

Testing the Foundation

The global economy isn’t headed into recession, at least not yet. This month, David Lafferty, Chief Market Strategist at Natixis Global Asset Management, examines current capital market and portfolio risks for signs of recession. Click Here for Capital Market Notes


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