Banks

The banking sector is concerned with a range of issues arising out of the financial crisis, including the Independent Commission on Banking's recommendations and the further reforms of prudential regulation put forward by the European Commission and the Basel Committee, following closely on the recent implementation of Basel II and the Capital Requirements Directive (CRD), CRD II and CRD III. This, combined with the Basel Committee's broader review programme, keeps capital issues at the top of the regulatory agenda.

The FSA's "treating customers fairly" initiative also continues to be a major theme. There is a particular focus on responsible mortgage lending and mortgage arrears, and the implementation of the FSA's Retail Distribution Review, which addresses structural issues in the retail investment market, is likely to have far-reaching effects on the industry. Additionally, the enhanced conduct of business regime for retail deposit takers and implementation of the Payment Services Directive and the new Electronic Money Directive are of particular current concern.

The UK and international financial regulatory landscape is in the process of significant change in light of the UK Government's plan to replace the FSA, and the creation of the new European regulatory authorities.

The spotlight and media interest also continue to fall on senior management following the publication of the FSA's remuneration code of practice, the Walker review on corporate governance in the financial sector and the consequential focus and increased scrutiny by the FSA on risk governance.