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MMR: Advice proposals push up compliance cost estimate

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  • 25/10/2012
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MMR: Advice proposals push up compliance cost estimate
The Financial Services Authority has revised up its expectations for total ongoing compliance costs of the Mortgage Market Review proposals to range between £49m and £172m a year, it said in its final MMR paper (PS12/16).

In its cost benefit analysis, the regulator said it expects one-off compliance costs to range between £42m and £67m, on the original MMR proposals.

The regulator admitted it had underestimated the compliance costs of removing the non-advised sales process.

The FSA said one-off costs of the advice proposals are likely to increase from its previous estimate of £0.8m to £2.8m. It expects ongoing compliance costs on its advice proposals to increase from £1m to £3m.

It said it had revised its estimate to take into account the fact that some lenders have a much larger percentage of non-advised sales at present and may need to recruit additional staff.

 

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