But we are where we are and recent FSA announcements are defeating my earlier cynicism. Furthermore, the FSA will continue to enjoy growing support if it can now deliver on its latest manifesto.Its new principle-based approach still tastes like a fudge and may well come back to bite the regulator. But on the plus side, there has been a willingness to get stuck into the following – streamlining a verbose and opaque handbook; stimulating the Financial Promotions Active Group, with specific “yellow cards” being shown to the sub-prime, lifetime and second-charge sectors; lightening its touch – the first 30 proposed improvements to the way it regulates is an excellent start and warning off pan-European proposals from Brussels. Most of this is laudable. But a constructive relationship with the AMI will wane unless the FSA sharpens its incisors on what are some fundamental issues for law-abiding brokers. These include the use of single-premium MPPI, the role played by some, but not all, lead-generation firms and, of course, financial promotions. The Sipp U-turn was a bloody saga but at least it demonstrated to the FSA just how easily such infractions can go unpunished, jurisdiction issues not withstanding. However, the regulator has to show some magnanimity on the following subjects and accept that surgery on some original conceptions is overdue and elementary. These revisions are universally sought and accord with what TCF is all about, starting with a pruned KFI of five, universally accepted, pages. Follow that with the phasing out of APR illustrations for everything except lifetime products and, most meaningful of all, introduce tariff reductions for well managed businesses. If a business is consistently compliant, why should it be funding the delinquency of those which are not? Moving on to regulation costs, we are told that the Deloitte study will now be a quarter late as the exercise was more complicated than originally envisaged. I’ll bet it was. When the number is finally known, I am convinced that the FSA may have to concede that, for the consumer, who will have borne much of the cost, the benefits will have been disproportionate and, worse still, completely underappreciated. I believe that the FSA knows this already and that, as 2005 progressed. some boardroom conversations at Canary Wharf will have featured the lines: “You know, we underestimated this mortgage lot. They are largely passionate and professional folk who know their business and give the consumer a fair shake. Have we overcooked this one?” I now concede that relevant regulation is wholly beneficial. It will encourage more new lenders but, like the man in the street, we want small government with big enforcement. A local copper on the beat whom we can have a regular dialogue with, who protects the good guys but puts the fear of God in to the bad guys. We don’t mind paying taxes for that.
Financial Express has launched a new Crown Ratings service for funds offering a quantitative system to use alongside other qualitative services and manager ratings.Crown Ratings cover UK authorised unit trusts and Oeics, offshore funds and life and pension funds. It is based on quantitative historical performance measures with funds rated by returns against benchmark, volatility […]
Amex refuses to comment on speculation that its wrap could face closure if a buyer is found for the platform. The Amex wrap has a range of 4000 funds and around 50m of assets under administration.
InvestmentTracy Watt has joined Axa Investment Managers as head of UK marketing. She will be responsible for the co-ordination and development of Axa IM’s UK marketing strategy and the delivery of marketing support for the UK business. Watt joins Axa from Mellon Global Investments, where she has been marketing manager for four years. Troy Asset […]
HSBC BAnk International
European Giants Growth Fund – CSGF January 2006
What a difference six months makes. Speaking in September last year, we had warned of ‘excessive pessimism’ afflicting the market’s perception of India. Since then, responsible central bank policy from the Reserve Bank of India (RBI), alongside improving global growth, has meant that India’s macro environment is strengthening quickly. The current account deficit has shrunk, inflation is falling and the government has embarked on a heavy dose of much needed fiscal consolidation. As a result, the rupee has been one of the strongest global currencies this year while the market has touched all-time highs, rallying by more than 20 per cent (GBP) since September. This begs the question: are we now in a period of ‘irrational exuberance’? Not yet.
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