From 1st July the Council of Mortgage Lenders is integrated into a new trade association, UK Finance. For the time being, all UKF mortgage information will continue to be published on this website, and UKF member-only mortgage information will only be available here.

UK Finance represents around 300 firms in the UK providing credit, banking, markets and payment-related services. The new organisation takes on most of the activities previously carried out by the Asset Based Finance Association, the British Bankers’ Association, the Council of Mortgage Lenders, Financial Fraud Action UK, Payments UK and the UK Cards Association. Please go to for wider content and updates from UK Finance.

Published: 16 October 2012

The Council of Mortgage Lenders welcomes today's publication by the Financial Services Authority of "Journey to the FCA",  a paper that gives more detail about how its successor, the Financial Conduct Authority, will operate.

This follows yesterday's document from the Bank of England and the FSA on the Prudential Regulatory Authority's (PRA) approach.

It is clear that the FCA's focus, and its ways of working, are likely to be different to those of the FSA. There will be a greater element of judgment involved in relation to individual firms' business models, practices and product offerings. The new FCA approach to product intervention will be pro-active and pre-emptive, and firmly aimed at preventing consumer problems. This potentially creates a very different operating environment for firms.

As the FCA notes, it will be important for the new regulator "to communicate more effectively with firms that want to do the right thing, and we must be clearer about our expectations". The CML welcomes the FCA's intention to "engage more with firms, trade associations, the practitioner panels and other relevant stakeholders when we start pieces of thematic work on issues and products", as well as to ensure that heads of supervision with responsibilities for specific sectors will "engage with groups of firms and trade associations, as appropriate, to gain a more in-depth understanding of specific sectors, along with building an open and transparent relationship.

Meanwhile, yesterday's paper by the PRA said it wanted to set clear standards for firms, but that its "approach will be very clearly based on judgement rather than narrowly rules-based."

The CML, covering some 95% of the UK mortgage lending industry, looks forward to working with the FCA, and the PRA, and to contributing to the evolving framework to ensure that the important bedrock of communication about expectations works as intended as the new regulatory bodies become a reality.

Paul Smee, CML director general, comments:

"The FCA will have an armoury of new consumer powers at its disposal, some of which - like product intervention - are untried and untested. Firms will be looking for as much information and help as possible from the FCA, to ensure that they do not inadvertently fall foul of the regulator's expectations. The challenge, for firms and the FCA alike, will be to meet the regulator's aspiration of allowing businesses room to try new ideas, while at the same time minimising uncertainty for them about whether those ideas will successfully leap the regulatory hurdles. We will engage with both the FCA and the PRA, and hope for a high level of dialogue and communication with both regulators."

Notes to editors

1. The Council of Mortgage Lenders' members are banks, building societies and other lenders who together undertake around 95% of all residential mortgage lending in the UK. There are 11.2 million mortgages in the UK, with loans worth over £1.2 trillion.

2. "Journey to the FCA" is available to download from the FSA website.

3.  The Bank of England, Prudential Regulation Authority - The PRA's approach to banking supervision - is available from the FSA website.

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