FSA report reveals fall of 5,657 in number of ARs

FSA report reveals fall of 5,657 in number of ARs




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In the FSA’s Annual Report 2008/9, published yesterday, it was revealed that the number of regulated firms and approved persons (ARs) suffered a large fall in a year blighted by harsh market conditions.

Between the 1st of April 2008 and the 31st of March 2009, the number of ARs went from 172,077 to 166,420 – making a fall of 5,657, equal to 3.29% of ARs in the UK.

 

The number of regulated firms also fell by 985, from 28,325 in April last year to 27,340 this year.

 

Blaming the impact of the credit crunch on the decline, the chief executive of the FSA, Hector Sants, stated: “It is critical to understand that the individual firm problems we have seen emerge in the last year had their origins in the boom, and were not reversible in the current market conditions.” 

 

An AR is an individual approved by the FSA to perform “controlled functions” on behalf of an authorised firm. During the year, the regulator said that 43,035 applications for ARs had been approved, approximately 17.5% less than the previous year.

 

Although the drop has been put down to the problems in the housing market, many industry figures have pointed out that some of the controversial proposals listed in FSA’s Retail Distribution Review (RDR) will lead to a further decline in numbers.

 

The RDR consultation paper is due out today, and will highlight various important issues for the future of the retail investment advice sector.

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