Wealth Manager - the site for professional investment managers

Register to get unlimited access to all of Citywire’s Fund Manager database. Registration is free and only takes a minute.

FSCS increases 2014/15 levy 17%

FSCS increases 2014/15 levy 17%

The Financial Services Compensation Scheme (FSCS) plans to increase its levy on financial service businesses by 17% in 2014/15 with an additional £30 million charge on investment intermediaries.

The broad levy, charged to sector businesses to cover the cost of business and other failures, will rise from £285 million to £313 million.

That excludes a specific £30 million charge on investment distribution businesses however, to ‘cover a potential deficit in this class’, bringing its overall charge for sector businesses to £105 million, and the total levy for the period to £343 million.  

FSCS chief executive Mark Neale said: ‘Our mission is to provide a responsive, well-understood and efficient compensation scheme for customers of financial services, which raises public confidence in the industry.’

The organisation’s plan and budget, which will remain open for consultation to 21 February, anticipates a 20% increase in the volume of new claims, primarily due to the continuing fallout from payment protection insurance claims.

The charge levied against investment intermediaries reflects the expected volume of claims related to the failure of Catalyst Investment Group over its promotion of funds managed by ARM Asset Based Securities, which has been suspended since 2011.

For the first time the FSCS has calculated the 2014/15 levy over 36 rather than 12 months. It said that this was intended to reduce the volatility of charges, which in recent years have had to be topped up with secondary levies to cover the total cost of compensation.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play JP Morgan AM's Conte: why France is my biggest overweight

JP Morgan AM's Conte: why France is my biggest overweight

The European Smaller Companies trust fund manager is also finding opportunities within the European IPO market.

Brewin's Foster: running out of value with Sandy Nairn

Brewin's Foster: running out of value with Sandy Nairn

In this week's podcast, Guy Foster and Dr Sandy Nairn discuss caution towards the stretched valuations most stock markets today currently offer.

Play Colin McLean eyes disruptive potential

Colin McLean eyes disruptive potential

SVM's Citywire AA-rated manager says he is finding more opportunities within mid cap space.

Your Business: Cover Star Club

Profile: BRI plots growth via orphaned clients

Profile: BRI plots growth via orphaned clients

BRI Wealth Management hopes to capitalise on larger rivals’ inability to service smaller clients in the face of margin & regulatory pressure

Wealth Manager on Twitter