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3to2 - 10 Key Focus Areas For Financial Services Firms 2025_alev-takil-7ojyp-IXW7w-unsplash_50034

In this publication and podcast series, we explore some of the core focus areas for UK-regulated financial services firms in the year ahead.

In 2024, we saw disruption to the regulatory reform agenda as the unexpected timing of the general election impacted work and publication schedules. Now that the reform agenda is back on track and aligned to the new government’s plans for growth, we are likely to see improved progress on existing reforms as well as fresh initiatives in the pursuit of growth during 2025.

There is doubtless a strong focus on retail markets under the new government, but the UK’s competitiveness as a place to do business remains vital as improvements to the UK’s wholesale markets continue. ESG and AI continue to dominate across the sector as rapidly evolving areas that profoundly impact the regulatory landscape.

Amazing London skyline with Tower Bridge during sunset

The proposals aim to drive more consistency in operational incident reporting and greater visibility in the use of material third-party services.

By Rob Moulton and Charlotte Collins

On 13 December 2024, the FCA and the PRA published linked Consultation Papers on operational incident and third-party reporting (FCA CP24/28 and PRA CP17/24). The consultations aim to create a structured framework for financial services firms to report operational incidents and material third-party relationships. The proposals will help standardise the information that the regulators receive and enable them to identify systemic problems related to incident and third-party risk management.

Big Ben London England by Night

When the Edinburgh Reforms were announced on 9 December 2022, they were billed as an ambitious set of reforms. Two years on, we assess which of the measures have been completed, which remain outstanding, and whether they have delivered on the agenda set out.

We also reflect on the recent Mansion House announcements, which have reset the future of regulatory reform.

Read the full report.

banking

Proposals reflect drive to enhance the competitiveness of the UK regulatory landscape.

By Rob Moulton, Kendall Burnett, Sarah Gadd, Charlie Bowden, and Charlotte Collins

On 26 November 2024, the PRA and the FCA published a joint Consultation Paper on changes to the remuneration rules (PRA CP16/24, FCA CP24/24). The changes are relevant to banks, building societies, and PRA-designated investment firms.

While the amendments to the rules on deferrals and retention had been previewed by both the…

Amazing London skyline with Tower Bridge during sunset

The new regime will take effect on 1 January 2025, but will not diminish the responsibilities of financial services firms relying on the services of critical third parties.

By Rob Moulton, Fiona Maclean, Alain Traill, and Charlotte Collins

On 12 November 2024, the PRA, FCA, and Bank of England jointly published a Policy Statement (PRA PS16/24 and FCA PS24/16), setting out their final rules for critical third parties (CTPs). The regulators consulted on this framework in December…

Modern building facade

The UK Chancellor announces a growth-focused agenda for financial services.

By Rob Moulton, Nicola Higgs, Becky Critchley, and Charlotte Collins

On 14 November 2024, the new Chancellor of the Exchequer, Rachel Reeves, delivered her first Mansion House speech. She used her speech as an opportunity to announce reforms designed to drive growth and competitiveness in financial services, stating that many of the regulatory changes introduced to eliminate risk after the financial crisis had “gone too far” and led to unintended consequences. Although she did not announce a swathe of deregulatory measures, this speech sets the tone for how the government will likely approach regulation in the financial services sector going forward.

Amazing London skyline with Tower Bridge during sunset

PRA and FCA speeches recap the regulators’ work to deliver growth and enhance competitiveness, and outline some key upcoming policy work.

By Rob Moulton, Nicola Higgs, Becky Critchley, and Charlotte Collins

On 17 October 2024, the PRA and the FCA both published speeches given by their Chief Executives at the Annual City Banquet. Although the speeches cover different topics on the regulators’ policymaking agendas, both focus on how the regulators will further their new secondary objective to…

Aerial cityscape over London city at sunrise

This annual publication explores some of the core focus areas for UK-regulated financial services firms in the year ahead. 2023 saw significant progress on the regulatory reform agenda, and many measures consulted on or reviewed as part of the Edinburgh Reforms will be finalised and/or implemented in the course of 2024.

We also saw the passing of the Financial Services and Markets Act 2023, many provisions of which have already come into effect and have made important changes to the…

Cloudless day at financial district of London

Critical Third Parties serving the UK financial sector must ready themselves for compliance with the newly proposed operational resilience requirements.

By Rob Moulton, Fiona Maclean, and Charlotte Collins

On 7 December 2023, the PRA, FCA, and BoE jointly published a Consultation Paper (PRA CP26/23 and FCA CP23/30) which proposes a set of regulatory requirements and expectations for critical third parties (CTPs) that provide services to authorised persons, relevant service providers, and financial market infrastructure entities (FMIs). The key aim of the proposals is to manage potential risks to the stability of, or confidence in, the UK financial system that may arise due to a failure in, or disruption to, the services that a CTP provides to such entities.