The Financial Services Authority (FSA) has announced changes to its supervisory approach, which aim to improve its Arrow risk framework, the way it manages relationships with firms and how it deals with general correspondence.
The regulator says it is reviewing and improving its risk-based approach (Arrow) to firm supervision and to its thematic work, which is used when assessing risks involving several firms or which relate to the sector as a whole. Specific changes the FSA is making include: A revised model (Arrow II) allowing supervisors more accurately to reflect their assessment of risk in individual firms or through cross-firm thematic work; Better communication with firms on its assessment of them and getting them more involved in the process. For example, Arrow risk assessment letters have been...
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