Value for money, with the FSA | FT Alphaville

Value for money, with the FSA

The Financial Services Authority (FSA) has today announced its proposed Annual Funding Requirement (AFR) for 2011/12. The AFR for 2011/12 is £500.5m, up from £454.7m in 2010/11, a gross increase of 10.1% in overall funding. The increase will be borne by larger firms, reflecting the resources applied to intensive supervision of high impact firms…

(Note — net of discounts after fines, companies will actually be paying 2 per cent less to the FSA than in the last AFR.)


In time-honoured ‘how many London buses is that?’ journalistic fashion:

What else could £500m get you in today’s UK banking system?

— Not a lot of Crock

— 1/70th of UK taxpayer holdings in RBS (December 2010 figures)

— 1/35th of UK taxpayer holdings in Lloyds

— 1/25th of UK taxpayer paper losses on holdings in Lloyds and RBS

— 1/248th of all government cash used to prop up UK banking system

— 1/400th of Bank of England asset purchases since 2009

— 1/1778th of net UK government debt, excl. bank interventions

— 1/4644th of net UK government debt, incl. bank interventions


According to Hector Sants, FSA chief executive:

The total cost of implementing regulatory reform is yet to be calculated. The HM Treasury consultation document issued in July 2010 made an initial estimate of £50m and work is under way to quantify this more precisely. In 2011/12, the FSA believes the direct costs will be £10.9m. The FSA also estimates that there will be substantial indirect costs as staff reschedule other work to create the capacity needed to implement the changes.

Looking like an absolute steal to us, Hector.

Related link:
Crock regulation – FT Alphaville