Greater focus on internal governance and control, rules enabling banks to fail in a controlled manner and concentrated efforts to resolve problems related to financial advice. These are the important lessons highlighted in this year's Supervision Report.
The Supervision Report compiles the lessons Finansinspektionen learned from its supervision of the financial sector in the past year. This year's report to the Government highlights several issues in particular.
The first is the need for functional internal governance and control. A number of high-profile interventions in the past year have brought this question to the forefront and FI will review its regulations in this area.
Another lesson is the need for tools to handle banks in distress. Regular rules for bankruptcy and liquidation are not sufficient and FI would like to highlight the need for further development of the special framework for handling banks in crisis.
FI would also like to highlight the problems on the Swedish financial advice market and, in particular, the deficiencies at insurance intermediaries. FI sees a conflict in interest between advice and commission-based pay and believes that the Government should consider a ban on commissions for intermediaries.
FI would like to deepen its assessment of companies and persons receiving authorisation to conduct business on the financial market. This would mean new procedures for the assessment of qualifying owners and senior management as well as new procedures for authorisation processes.
FI also proposes that the level of financial penalties be raised. The reasoning behind this proposal is that the system must be in proportion to both large and small companies alike. FI proposes that the ceiling for the highest possible financial penalty be raised from today's maximum of SEK 50 million to SEK 500 million.