DIPFS Unit 4 Topic 5 - Political

Which area of PESTEL analyses lifestyle, employment, unemployment and demographic trends?

• Social

• Economic

• Political

• Technological

Prior to the financial crisis of 2007, the UK attracted international banks because it was seen to have a:

• balanced approach to regulation

• heavy-handed approach to regulation

• light touch approach to regulation

• Other

Complying with regulation can be

• an incentive for new providers to enter the banking industry

• more difficult for banks than for building societies

• a barrier to new providers entering the banking industry

• annoying

Which of these are codes of banking practice?

• The Standards of Credit Sales

• The Standards of Lending Practice

• Banking Conduct of Business Sourcebook

• The Banking Consumer Protection Act

The Standards of Lending Practice form:

• a voluntary banking code that covers the sale of credit excluding mortgages

• a voluntary banking code that covers the sale of credit including mortgages

• a compulsory banking code that covers the sale of credit excluding mortgages

• a compulsory banking code that covers the sale of credit including mortgages

The Banking Conduct of Business Sourcebook form:

• a voluntary banking code that covers the sale of credit

• a voluntary banking code that covers the deposits

• a compulsory banking code that covers the sale of credit

• a compulsory banking code that covers deposits

Which of these options explain why regulation is necessary?

• More sustainable financial system

• Promotes confidence

• Protects consumers

• Financial institutions have to have confidence in each other

What costs are involved in regulations?

• Fees to FCA and PRA

• Fees to Bank of England

• Levies to FOS and FSCS

• Staff Training

Since financial regulation covers a very large area of business and many different products, the rules must cover a wide range of possibilities. Is it better to...

• Improve the quantity of regulations

• Improve the quality of existing regulations

• Make a new regulator to oversee everything

• Scrap regulations

What might happen if the regulation is too strict?

• More sustainable financial system

• Promotes confidence

• Protects consumers

• Limit competitiveness between providers