Everything you need to know about drafting a winddown plan

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Exit plan specialists

fscom has partnered with Sia Partners’ subject matter experts who have extensive experience in compiling recovery and exit plans for payment and e-money institutions in the Netherlands. The Dutch regulator, the DNB has focused significantly on this requirement in recent years and, therefore, Sia Partners are in an excellent position to share their experience and knowledge in devising robust winddown plans while fscom ensures it is tailored to both the client and to the FCA’s expectations.

FCA focus on winddown plans

The partnership comes as a result of the recent focus on winddown plans by the FCA. Within the recent consultation on new safeguarding guidance for payment and e-money institutions, the FCA included guidance on what should be included in a winddown plan. According to the proposed guidance, the winddown plan should include or address the following points.

  1. Funding to cover the solvent winddown of the firm, including the return of all customer funds.
  2. Realistic triggers to start a solvent winddown.
  3. The need for any counterparties (i.e. merchants) to find alternative providers.
  4. Realistic triggers to seek advice on entering an insolvency process.
  5. Information which would help an administrator or liquidator to quickly identify customer funds and return them as a priority.

Commenting on the FCA’s focus on winddown plans, fscom’s director, Alison Donnelly, said “the FCA’s consultation on the temporary guidance has been prompted by the exceptional circumstances of the coronavirus pandemic. The FCA is rightly concerned about the impact on consumers if, or when, payment service providers fail. Firms must consider an array of possible situations and the complex arrangements surrounding their business to ensure they can smoothly exit in such a crisis situation.

Sia Partners, Associate Partner of Financial Services Netherlands, Paul Geerts said: “We can help fscom’s impressive client base to develop robust exit plans that will meet the expectations of the UK regulator. But not only that, in our experience, the exercise of developing the winddown plans, which involves significant input from the client’s senior staff, becomes a useful assessment of the business that has wider, positive benefits.”

Alison Donnelly concluded: “At fscom, we are committed to continually investing in strengthening and building upon our value proposition for clients. We are delighted to combine our team’s unrivalled deep domain expertise in regulatory compliance with Sia Partner’s in-depth experience in recovery and winddown services. This allows us to provide our clients with an end to end, holistic regulatory compliance solution to ensure the expectations of the FCA are fulfilled.”

If you have any queries on winddown plans, feel free to get in touch.

Get in touch with fscom today!

fscom is a boutique consultancy specialising in regulatory compliance solutions to the financial services sector.

Sia Partners are global business transformation consultants specialising in helping businesses implement organisational change.

This post contains a general summary of advice and is not a complete or definitive statement of the law. Specific advice should be obtained where appropriate.

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