On 20 June 2022, the Bank of England confirmed that it will be withdrawing its mortgage affordability test recommendation. The withdrawal will come into effect from 1 August 2022. The mortgage affordability test was introduced in 2014 to guard against a loosening in mortgage underwriting standards and a material increase in household indebtedness. The test … Continue Reading
On 11 March 2022, the FCA published a letter (dated 15 February 2022) which it sent to firms in its retail mortgage lenders (RMLs) portfolio. The letter sets out: The FCA’s views on the key risks of harm for RMLs’ mortgage customers over the next 2 years. The key risks of harm are supporting mortgage … Continue Reading
On 11 March 2022, the FCA published a letter (dated 11 March 2022) to firms within its building societies portfolio. In the letter the FCA provides an: Updated view of the current key risks of harm and outlines its expectations of societies. Overview of its supervisory strategy and programme of work to ensure that firms … Continue Reading
On 28 February 2022, the Financial Policy Committee (FPC) issued a consultation seeking views on the withdrawal of the mortgage affordability test. In 2014 the FPC issued two recommendations that sought to prevent a loosening in mortgage underwriting standards and a material increase in household indebtedness that could amplify an economic downturn. The recommendations introduced … Continue Reading
The Office of the Superintendent of Financial Institutions (OSFI), the federal financial institutions prudential regulator, recently addressed the issue of a cap on issuance of covered bonds which presently stands at 4% of a bank’s total assets. OSFI is now taking a hard look at this limit and is doing so in the context of … Continue Reading
