In a speech delivered today at the BBA Retail Banking Conference, Bailey highlighted the FCA’s strategic review of retail banking business models, focusing on links between different products and services and their relative profitability.
“It is very much an empirically driven piece of work which picks up where the Competition and Markets Authority (CMA) left off, but is not a full evaluation of the functioning of competition in retail banking markets,” he said.
“It is broader in scope than the CMA’s work, which focused on personal current accounts and SME banking. We are covering both sides of the balance sheet of banks – deposit taking and lending. We are already in touch with stakeholders on this work. It is, I should say, an ambitious project.”
Secondly, the regulator is reviewing high-cost credit, including overdrafts, to build a full picture of how these are used, whether they cause harm and, if so, to which consumers. Findings are due to be published over later this summer.
Thirdly is a thematic review responding to recommendations from the Parliamentary Commission on Banking Standards report in 2013 that banks should assess customers understanding of the products and services they deliver.
