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04 Dec 2013

FCA To Finalise Proposal On SIPP Capital Adequacy Requirements Next Year

The Financial Conduct Authority (FCA) is still not ready to present its proposal on increasing capital adequacy requirements for self-invested personal pensions (SIPPs), delaying its suggestion for the second time this year.

In November 2012, the FCA published plans to increase the minimum required capital for SIPP firms from £5,000 to £20,000, but the exact way in which the change had to be implemented was to be presented later. The reform aims to ensure that SIPP investors are protected against financial losses in case of administration failure.

The proposal was due to be published in September but was delayed. Now, the authority stated that it will not be presented by the end of 2013 either, because the regulator needed time to consider the results of the thematic review that began in October. Nick Poyntz-Wright, FCA director of long-term savings and pensions, told attendees at the Association of Member-directed Pension Schemes event that the proposal will be presented in the first quarter of 2014.

Poyntz-Wright explained that the authority needed more time to finalise the proposal because there were two key factors to be taken into account. First of all, the FCA has received numerous responses to its consultation and needs to give all of them detailed consideration. The second reason for the delay is the fact that the FCA´s thematic review is likely to provide more information about the different types of investments in SIPPs that will help the regulator plan the reform more effectively, Money Marketing reported.

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