In this joint Consultation Paper (CP), the Prudential Regulation Authority (PRA) and Financial Conduct Authority (FCA) propose updating the PRA’s notes to the Mortgage Lenders & Administrators Return (MLAR), the notes for completion of the MLAR in the Supervision manual (SUP) of the FCA Handbook (henceforth, both notes will be referred to as Notes to the MLAR in this CP), and the MLA-D1 form for reporting second charge lending, also in SUP. These changes, amongst other things, are to reflect fully the changes following transposition of the Mortgage Credit Directive 2014/17/EU (MCD) in the United Kingdom in March 2016. The proposals also include minor clarifications to other sections of the Notes to the MLAR. These clarifications will assist firms in their completion of the MLAR and to remove some existing inconsistencies between the PRA and FCA versions of the Notes to the MLAR.
The proposed updates and clarifications do not introduce any material changes to the Notes to the MLAR and do not result in any new reporting requirements.
Summary of proposals
Chapter 2 sets out the proposed changes to the PRA’s and FCA’s Notes to the MLAR as set out in PRA Supervisory Statement (SS) 34/15 and the FCA’s SUP 16.12 Annex 19BG in order to provide additional reporting clarifications.
This consultation is relevant to all firms that submit the MLAR, ie all firms carrying on the regulated activities of home finance providing activity and administrating a home finance transaction. As a consequence, the changes are relevant to both FCA-only regulated firms and dual regulated firms.
The policy has been designed in the context of the current UK and EU regulatory framework. The PRA and FCA will keep the policy under review to assess whether any changes would be required due to changes in the UK regulatory framework, including those arising once any new arrangements with the European Union take effect.
Responses and next steps
This consultation closed on Monday 13 March 2017.
Appendix 1
Notes for completion of the Mortgage lenders & administrators return (MLAR)
Appendix 2