The UK financial Services Industry Flashcards

1
Q

Both individuals and companies have protection needs on their:

A

Physical assets
Earnings
Profit potential
Financial transactions

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2
Q

What are the two options for government borrowing?

A

Gilts and national savings and investments (NS&I)

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3
Q

How does a gilt work?

A

They pay fixed levels of income over regular intervals (6 months)

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4
Q

Which benchmark is used to measure the rate of inflation for index linked gilts ?
When and what index are they moving to?

A

Retail Price Index

2030 & Consumer Price Index including Housing (CPIH)

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5
Q

What are the two objectives for capital markets?

A

Enable investors to invest in assets that provide the potential for real growth
Help companies raise money without necessarily going to the bank

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6
Q

Capital markets introduced which to types of financial instrument?

A

Shares
Fixed-Interest stocks (bonds)

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7
Q

What are the four key components within the financial sector

A

Financial infrastructure
Financial markets
Financial firms
Financial sector authorities

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8
Q

Who overseas the payment systems in the UK?

A

The Bank of England

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9
Q

Who is the operators of the UK’s retail payment systems?

A

Pay.UK

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10
Q

Who regulates the payments system industry?

A

Payment Systems Regulator (PSR)

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11
Q

What is a over-the-counter trade? The

A

Participants trade stocks, commodities, currencies, or other instruments directly between two parties and without a central exchange or broker.

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12
Q

What are the core services of Banks and building societies?

A

Current accounts
Deposit accounts
Mortgages and loans

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13
Q

What are the main indirect services offered by banks and building societies?

A

Portfolio management
Stockbroking services
Wills and executorship
Collective investments
Insurance and pensions

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14
Q

What is a bancassurer?

A

A bank or building society which have set up their own insurance company which forms part of their ties or multi tied offering

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15
Q

What are the three EU supervisory authorities?

A

European Banking Authority (EBA)
European Securities and Markets Authority (ESMA)
European Insurance and Occupational Pensions Authority (EIOPA)

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16
Q

Which government department is responsible for the regulation of financial services?

A

The Treasury

17
Q

Who has the overall authority over the Treasury?

A

The Chancellor of the Exchequer

18
Q

Name the three regulatory bodies under the Financial Services Act (FSA):

A

Financial Policy Committee
Financial Conduct Authority
Prudential Regulation Authority

19
Q

What is dual regulation?

A

When FCA and PRA regulate together

20
Q

Who governs the PRA?

A

Prudential Regulation Committee

21
Q

What can the impact of taxation have on the economy?

A

To raise revenue for the government and to re distribute wealth

22
Q

What is the purpose of high and low taxation

A

High taxation reduces the money in circulation so reduces the ability to spend
Low taxation means more money available so stimulates the economy

23
Q

What is the fiscal policy?

A

Control of taxation, government spending and borrowing

24
Q

What is the monetary policy?

A

Control of interest rates and money supply

25
Q

How does the government borrowing and spending money effect the economy?

A

Spending: more money in circulation more significant than tax cuts
Borrowing: reduces money in circulation so reduces economic activity

26
Q

Who sets the interest rates?

A

The Monetary Policy Committee within the Bank of England

27
Q

What is used to influence short-term interest rates?

A

Gilt Repo Market

28
Q

What is the FATF an abbreviation of?

A

Financial Action Task Force

29
Q

Historically, uk banks and building societies were developed from the consumer need to:

A

Provide a safe but accessible place to keep individuals money