The Prudential Regulation Authority (PRA) and Financial Conduct Authority (FCA) have published a joint consultation paper on proposals for new reporting requirements that would apply to mortgage lenders and home finance administrators.
In this paper, the two regulators have set out proposals for new reporting requirements that would impact mortgage lenders, and contains proposals made solely by the FCA in relation to its objectives, along with joint proposals that are given effect through a combination of PRA and FCA rules.
In its consultation paper, the regulators proposed that administrators report PSD007 on loans they administer on behalf of unregulated entities. However, there may be a cost to some administrators, as they have to set up systems that support the reporting of PSD007, though the information required to produce the report should already be in possession of the administrators.
In terms of value, the authorities have estimated that the setup of these systems would require 234 days of personnel time per firm, along with a one off cost of £82,381 and ongoing costs of £8,240. The time and cost has been calculated using the FCA’s standard cost methodology.
The second set of proposals are in relation to PSD001 changes, and have been designed to reduce costs for firms by spreading the fixed costs of the necessary change projects across changes that will be implemented in a single change.
As a result of these changes, all lenders will have to upgrade their systems to start reporting a new version of PSD001, which includes additional fields and changed validation rules. Some of these changes result from PRA requirements and other from FCA requirements.
The FCA and PRA invite feedback on the proposals in this paper, and have asked that all feedback be submitted by Friday 22 March 2019.
The rules are expected to be published in a joint statement in the middle of 2019, and plan to offer firms an implementation period of a year following that publication.
To read the full consultation paper, click here.
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