Finance & Accounting
Pages 40 (10040 words)
Assignment 3: Discuss the banking regulatory and market framework in UK, address the strengths, weaknesses, opportunities and threats. The UK financial services industry The financial services industry in Europe is comprise of the subsectors shown in the table following.
In 2009, collections for insurance premiums alone totalled nearly ?200 billion. The UK market for equities garnered 17% share of the global market in 2009, ranking only behind New York. Likewise, the fund management industry ranks among the world’s largest, managing some ?4.1 trillion for the year 2009. All in all, the financial services sector turned in the largest volume of corporate taxes for 2010, which comprised 11.2% of total tax receipts for the entire year. Contribution of output & employment to the UK economy from each financial services sector Financial Services Sub-Sectors Output (% of GDP) Employment Banking 5% 435,000 Insurance 2% 300,000 Fund Management 1% 50,000 Others including securities derivatives, commodities, and bullion 3% 208,000 Total 10% 993,000 Source: U.K. Parliament, 2011 Definition of financial stability The Bank of England is the statutorily designated entity to ensure the financial stability of the financial system of the UK, as pronounced in the Banking Act 2009. The specific definition of financial stability is difficult to delineate, because its context evolves over time. According to Adrian Coles, Director General of the Building Societies Association, articulated a definition for the proximate term, “monetary stability” in terms of a measurable objective, that is, the maintenance of a target inflation at 2%. ...