The Financial Conduct Authority’s chief executive has said the regulator is not “overstretched” as he outlined plans to create a more efficient working model.
In a Treasury Committee session yesterday (May 12), FCA CEO Nikhil Rathi was questioned on the watchdog’s performance as a regulator, following well publicised sagas such as its handling of the LCF minibond scandal.
Defending the FCA, Rathi said: “I think the record of 2020 shows the FCA can move incredibly quickly to deal with very urgent and pressing issues. I think the challenge that I have is that there is a significant new executive team arriving and that is the bottle.
“There have been particularly acute issues to deal with over the last year and where we need resources, we are going to get the resources, for example dealing with appointed representatives. There are areas where we think the regime could be strengthened and enable us to use our resources in a more efficient way.
“But I’m not going to sit here and say we are overstretched, you’ve given us a job to do and it’s my job with the executive team and the other side of the board to allocate our resources to fulfil the remit as best we can.”
Owning up to mistakes from the past, Rathi admitted that the regulator could have done things differently.
“In the past there are areas where we could have been faster, where we could have shared data more efficiently, where we could collaborate across departments, and we are investing in our systems, our controls, to enable us to use technology better with better capability to enable us to move in a more agile way in the future,” he said.
Outlining the changes ahead, he highlighted the ‘transformation programme’ which is to be spearheaded by himself.
Rathi said the regulator has already rolled out training in a whole range of areas including on financial accounting and was making progress on the technology front in moving out of the data centre to cloud platforms, which he hopes will help the FCA handle data in a much more efficient way.
It also has plans to look at how the FCA can streamline decision making and governance to be faster.
That will include thinking about "whether we've got the right structures in place to make some of the regulatory decisions and our regulatory decisions committee, or whether we should be making more decisions at the executive layer around supervisory conventions to allow the regulatory decision to just focus on the big cases and process them as speedily as possible so there's some significant work on the way there,” he said.
Touching on a question about FCA fees and whether they are proportionate, he added: “We have sought this year to keep minimum fees unchanged, other than for certain consumer credit firms where we have needed to increase.