Nick Bayley Discusses the FCA's Warning to Banks Over Extra Fees

Nick Bayley, Managing Director in Duff & Phelps’ Compliance and Regulatory Consulting practice spoke to the Financial Times about the letter the Financial Conduct Authority (FCA) sent to UK lenders warning banks against pressuring companies for unnecessary extra fees for share issues during the pandemic.

The FCA claimed it heard “credible reports” that some lenders were abusing their relationships with clients to demand lucrative roles on equity capital raisings. Any lenders seeking to extract money from a client in this way would be in breach of several UK regulations governing standards of market conduct, prevention of conflicts of interest and acting in clients’ best interests.

Nick advised lenders should consider their reputation ahead of their profits and commented that “firms should not be taking advantage of desperate clients”.

“I think this is the kind of thing that’s going to play very badly in the post-crisis analysis, if issues are treated badly by their brokers and banks in these kinds of situations. The fact that some have clearly chosen to pick up the phone to the FCA suggests that they’re deeply concerned about it.”

Subscribers can read the full article here.

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