The Association of Financial Mutuals has welcomed the publication of the Mutuals Landscape Report, the first joint assessment from the Prudential Regulation Authority and the Financial Conduct Authority examining the potential of the UK’s mutual and co-operative sector.
Published under a government mandate to help double the size of the sector, the report highlights the value mutuals bring to the economy and financial resilience through consumer trust, financial inclusion and corporate diversity.
The report notes work already undertaken by regulators to make the regulatory framework more proportionate and sets out next steps, including providing greater clarity on the Part VIII transfer process for friendly societies.
It also confirms that the joint FCA and PRA Scale-up Unit, designed to provide regulatory support to firms with high growth ambitions, will be open to mutual organisations.
Forthcoming FCA policy statements are expected following consultations to simplify insurance rules and clarify the advice and guidance boundary.
Alongside the joint report, the FCA’s Mutuals Registration function has published its own paper announcing the launch of the Mutual Societies Development Unit.
The new unit will explore opportunities to grow the sector through targeted policy initiatives and offer pre-application support to prospective mutual societies.
The AFM said it was pleased to see regulatory and legislative momentum, including support for the Law Commission’s reviews of friendly society legislation and Public Interest Entity audit reform. It called on the Government to progress the necessary legislation without delay.
Responding to the report, Andrew Whyte, AFM chief executive, said: “We welcome the PRA and FCA’s recognition of both the mutual sector’s vital role in the UK economy and its significant growth potential.
“It’s also good to see the regulators’ commitment to a tailored regulatory approach that enables mutuals to compete effectively alongside firms with traditional corporate structures.
“The introduction of the joint FCA and PRA Scale-up Unit is a positive step forward, which can help mutuals to make the most of opportunities to grow within an enabling regulatory framework.
“This report outlines practical measures the regulators plan to take to support the sector and is an important first step.
“Together with our members, AFM looks forward to continuing to work with both regulators to turn their good intentions into action, strengthening the sector and enhancing the UK’s financial resilience.”
