City watchdogs to push up fees by 20 per cent
9 April 2013 2:07am
BANKS are expected to bear the brunt of new rises in fees the financial sector pays to fund the restructured regulators, under new plans to be laid out today.
The Financial Conduct Authority (FCA) is expected to ask for around £391.5m, which was budgeted for in its business plan last month. The fees will be split across the industry with investment firms paying 30.3 per cent, lenders and deposit takers paying 28.5 per cent and insurance firms paying 13.6 per cent.
But as big banks face the most scrutiny and take the most regulatory resources, they will pay the most.
Meanwhile the Bank of England’s prudential regulation authority (PRA) is expected to ask for between £210m and £220m.
Together that amounts to just over £600m, a rise of roughly 20 per cent.
Lawyers expect the costs to be passed on to customers.
“The principle that financial firms rather than the taxpayer pay for their regulation is long established,” said Simon Morris from CMS Cameron McKenna. “This does not make regulation free to the public because the costs are passed on to customers and shareholders. The budgets come at a time of financial stringency and banks and insurers should not hesitate to challenge both PRA and FCA on ensuring they continue to provide value to the public for their money.”
Lenders are not likely to kick up a fuss as their reputations are already under the cosh. “When it comes to regulation we’ve just got to keep our heads down and do as we are told,” said an insider at a major lender.
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