IMA warns fund managers left on the hook over FSCS funding

The Investment Management Association (IMA) has called on the FSA to increase the amounts insurers and banks contribute to the FSCS after warning fund managers faced cross-subsidies which were three times higher than the other institutions.

In a letter to the FSA, the IMA proposed banks, as well as life and general insurers, should see the amount they contribute to any cross-subsidy raised substantially. Under the current proposals, organisations regulated by the soon-to-be-created Prudential Regulation Authority - covering firms such as banks and insurers - will contribute to the FSCS on a fee basis. However, firms falling under the scope of the Financial Conduct Authority  alone - which includes asset managers - will have to pay an amount dictated by an affordability calculation. The IMA said such a set-up could see...