The UK Financial Services

Question 1

What are the 3 European Supervision Authorities?

Answer 1

1. European Banking Authority (EBA) - Banking
2. European Securities and Markets Authority (ESMA) - Stock Markets
3. European insurance and Occupational Pensions Authority (EIOPA) - Life & Pensions

Question 2

What does the European Central Bank control?

Answer 2

The monetary policy and interest rates across the EU

Question 3

What does the European Systematic Risk Board do?

Answer 3

Also known as: ESRB

it monitors and assesses the stability of the financial system.

Question 4

What does the European System of Financial Supervision do?

Answer 4

Also known as: ESFS

it supervises individual financial institutions

Question 5

What does the financial stability board do?

Answer 5

Also known as: FSB

It concerns itself with the stability of the financial system globally.

Question 6

What does the financial action task force do?

Answer 6

Also known as: FATF

It concerns itself with worldwide global anti money laundering and development.

Question 7

What are the bodies responsible for the smooth running and regulation of the industry?

Answer 7

1. financial conduct authority (FCA)
2. Bank of England (BofE)
3. prudential regulation authority (PRA)
4. financial policy committee (FPC)
5. H M Treasury

Question 8

What are the 4 core activities or services offered by a building society or bank?

Answer 8

1. Current or cheque accounts
2. Deposit or bank savings accounts
3. Wills and executorship services
4. Mortgages and loans

Question 9

What are the 6 indirect activities or services offered by a building society or bank?

Answer 9

1. Portfolio management
2. Discretionary management service
3. Advisory management service
4. Execution only service
5. Stockbroking service
6. Offering access to collective investment schemes

Question 10

How could a client benefit from using a mutual organisation over a proprietary one?

Answer 10

Higher interest rates and lower charges.

Question 11

Which body authorises the HM Treasury?

Answer 11

The Chancellor of the Exchequer

Question 12

Which 3 bodies did the financial services and marketing act create?

Answer 12

1. FSA - Financial Services Authority - UK’s sole regulator
2. FOS - Financial Ombudsman Service - Handling advice complaints
3. FSCS - Financial Services Compensation Scheme - Sole compensation scheme where a provider goes bust

Question 13

What is the financial policy committee responsible for?

Answer 13

Stability and resilience of the system as a whole.
Reducing and removing risk.

Question 14

What is the responsibility of the Prudential Regulation Authority?

Answer 14

Regulates large authorised firms and providers promoting their safety and soundness.

Question 15

What is the responsibility of the Financial Conduct Authority?

Answer 15

Regulating conduct in retail and wholesale financial markets. Responsible for the prudential regulation of firms not covered by the PRA.
Responsible for the FOS, FSCS and the MAS which are funded through levies.

Question 16

What is the fiscal policy?

Answer 16

Governmental control of taxation, borrowing and spending.

Question 17

What is the monetary policy?

Answer 17

Control of interest rates and money supplies.

The Bank of England monetary policy committee (MPC) meets 8 times a year to set interest rates and meet inflation targets.

Question 18

What is the balance of payments?

Answer 18

A statement of all transactions made between one country and the rest of the world.