The Financial Conduct Authority (FCA) has laid out guidelines for firms that plan to draw down on capital buffers to stay afloat or exit the market during the coronavirus pandemic.
In an update following the FCA's relaxation of capital adequacy requirements for solo-regulated firms in March, the regulator said these firms played "an important role in supporting the functioning of the economy". "During this time of stress, we expect firms to meet this responsibility by planning ahead and ensuring the sound management of their financial resources. This means taking appropriate steps to conserve capital, and to plan for how to meet potential demands on liquidity," the FCA said. The note added that capital and liquidity buffers were to be used in times of stress and...
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