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Learn how to conduct Wind Down Planning

The FCA has recently provided guidance on how to conduct Wind Down Planning



The FCA recently completed a thematic review of wind-down processes across a number of business models. The review was aimed at reviewing firms on whether they held the appropriate liquidity, examining intragroup dependencies and wind-down triggers.


The review showed widespread weaknesses in wind-down planning and the need for firms to improve their wind-down processes as well as documentation.


Although the review focussed on the largest firms in several key industries. The observations and feedback from the review can be applied to all firms.


Risk Management and Wind Down Planning


You are required to consider the risks to your business during the FCA authorisation process. We note that the FCA identified during its review that most firms' risk management and wind-down planning lacked maturity (most had substantial gaps).


You will need to embed wind-down planning into your risk management framework, recognising that disorderly wind-down is a key driver of harm. You can do this by appropriately identifying their wind-down triggers.