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FCA warns businesses must have contingency plans to deal with coronavirus

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  • 02/03/2020
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FCA warns businesses must have contingency plans to deal with coronavirus
The Bank of England and Financial Conduct Authority (FCA) have pledged to take all necessary steps to protect the UK’s economy from the coronavirus, as fears grow over the impact of the infection on business and markets.  

 

Stock markets crashed last week over concerns the virus could affect growth.

Now the regulator said it expects financial service firms to have contingency plans in place to deal with a spread of the infection.

A spokesman for the FCA said: “The FCA is working closely with the financial services sector to ensure it is responding effectively to the outbreak. This is in conjunction with the Bank of England.

“As you would expect we have been in contact with a wide range of firms across the sector.

“We expect all firms to have contingency plans in place to deal with major events so that they are able to continue operating effectively. And, as part of that, to consider how best to support their customers.”

 

Bank of England monitoring economic impact

The Bank confirmed it is monitoring the infection spread and ready to take appropriate action.

A spokesperson for the Bank of England said: “The Bank continues to monitor developments and is assessing its potential impacts on the global and UK economies and financial systems.

“The Bank is working closely with HM Treasury and the FCA – as well as our international partners – to ensure all necessary steps are taken to protect financial and monetary stability.”

Stock markets this morning bounced back from lows reached last week in response to reassurance from monetary policymakers.

Experts last week predicted the market reaction to the virus could mean mortgage rates stay lower for longer.

Alex Maddox, capital markets director at Kensington Mortgages, said: “In the UK, we have seen swap rates come down from about 0.65 per cent to 0.55 per cent in the last 10 days, as the market is predicting slower central bank rate increases,” Maddox said.

“For mortgages, lenders also have an eye on deposit rates, but there will definitely be an impact and I think it will help keep mortgage rates down.

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