Retail Lending - Financial Conduct Authority FCA

Financial Conduct AuthorityRetail lendingStatisticSourceGB population aged 16 years andover is approximately51.37 millionFCA calculation based on ONS (2015) population data60% of GB adults have a creditcardFCA Credit Card market study final findings report (July 2016)40% of GB adults have anoverdraft facilityFCA calculation based on CMA Retail banking marketinvestigation final report (August 2016)27% of UK adults have a mortgageFCA Consumer Spotlight Survey (2013) - Internal48% of UK SMEs have a creditcardCMA Retail banking market investigation final report (9thAugust 2016)43% of UK SMEs have an overdraftfacilityCMA Retail banking market investigation final report (9thAugust 2016)There are 11.1 million mortgagesin the UKCouncil of Mortgage Lenders (12 May 2016)The ‘big six’ banking groupsaccount for 77% of outstandingmortgage balancesFCA / Bank of England mortgage lending statistics, MLAR (2016Q2)Household debt to income ratio143%OBR Economic and fiscal outlook (March 2016) 1.1 trillion balances outstanding– residential mortgageFCA mortgage lending statistics - MLAR (2016 Q2) 0.2 trillion balances outstanding buy to letFCA mortgage lending statistics - MLAR (2016 Q2) 100 billion Balances OutstandingCommercial MortgagesCouncil of Mortgage Lenders lending statistics (2016 Q1) 72 billion balances outstanding revolving unsecured consumercreditBank of England money and lending to individuals, table A5.6,credit card balances outstandingBBA overdraft balances outstanding (October 2016)

117 billion Balances Outstanding- fixed sum unsecured consumercreditBank of England money and lending to individuals, table A5.6,other consumer credit lendingSecured consumer credit - 1billion annual lendingThe National Pawnbrokers Association (2014) and Bank ofEngland credit conditions review (2015 Q3)Credit and debt services 30,000firms have credit brokingpermissionFCA Credit Authorisations data10.3% 12 month growth rateseasonally adjusted - totalconsumer credit lending,September 2016Bank of England money and lending to individuals, table A5.2 55,504 average total debt perhousehold, including mortgagesAug 2016The money charity - money statistics (October 2016)BBA overdraft balances outstanding (October 2016)Based on the 11.1m mortgages inthe UK, the estimated averageoutstanding per mortgage was 118,341 in AugustGeneral insurance and protectionStatisticSource27.1m UK households;ONS data (2016)17 million UK households havebuildings insuranceABI Insurance and Long term Savings Key Facts 20151.9 million UK households haveprivate medical insurance3 million UK households have petinsurance0.3m UK households have incomeprotection insurance70% of UK adults have carinsuranceMintel research – Motor Insurance UK (March 2016)76% of UK households havecontents insuranceABI Insurance and Long term Savings Key Facts 2015Over 80 billion of premiumsunderwritten by authorised generalinsurersFCA calculations based on various sources

125 billion held in reserves (topay future claims) in 2014FCA calculations based on various sourcesRoughly a quarter of consumerscould remember how much theyspent on their last year’s insuranceFCA Occasional Paper 12Pensions and retirement incomeStatisticSource34.1 million consumers, who rangefrom 16 years oldFCA Retirement Income data 2.1 trillion of assets/savingsmanagedFCA Retirement Income data and the Pensions Regulator66% of working population areenrolled in a workplace pension(June 2016)The Pensions RegulatorAs of March 2016: 7.2mconsumers taking a regular incomefrom an annuityFCA Retirement Income dataAs of March 2016: 0.4m ofconsumers in a drawdown productFCA Retirement Income dataTop five firms have:FCA Retirement Income data52% of defined contributioncontract-based pensions schemes43% of drawdown market67% of annuity marketIn first three months of 2016:127,000 pension pots wereaccessed for the first time58% of consumers enteringdrawdown took regulated adviceFCA Retirement Income data

Wholesale financial marketsStatisticSourceDerivatives80% of derivatives are tradedover the counter (OTC)Triennial Central Bank Survey of foreign exchange and OTCderivatives markets in 2016, Bank for International Settlements(September 2016)Average daily turnover OTCinterest rate derivatives: 1.2trillionTriennial Central Bank Survey of foreign exchange and OTCderivatives markets in 2016, Bank for International Settlements(September 2016)Average daily turnover OTC FXderivatives: 1.6 trillionTriennial Central Bank Survey of foreign exchange and OTCderivatives markets in 2016, Bank for International Settlements(September 2016) 493 trillion OTC Global OTCderivatives 2015 (notionaloutstanding)Semi-annual OTC derivatives statistics, Bank for InternationalSettlements (May 2016) 74 trillion exchange tradedderivatives, global ETD 2016Exchange-traded derivatives statistics, Bank for InternationalSettlements (September 2016)FX and commoditiesThe UK is the largest spot FXmarket - 39% of all global spotFX transactionsTriennial Central Bank Survey of foreign exchange and OTCderivatives markets in 2016, Bank for International Settlements(September 2016)The UK is the world’s largest FXmarket with over:Triennial Central Bank Survey of foreign exchange and OTCderivatives markets in 2016, Bank for International Settlements(September 2016) 784 billion in daily spotcurrency trades 2 trillion of total FX trades,including derivativesSpot transactions FX tradingcurrenciesd, 2016:Triennial Central Bank Survey of foreign exchange and OTCderivatives markets in 2016, Bank for International Settlements(September 2016)US dollar 83%; Euro 36%;Japanese Yen 19%; Poundsterling 11%; Australian dollar10%; Swiss franc 4% 5,080 billion global physicalcommodity market – annualvalue of production, 2009-10The EU Commission, Impact Assessment of Benchmark Regulation2013

Commodities annual valueof production, 2009-10:Oil47%Coal17%Agriculture16%Natural gas11%The EU Commission, Impact Assessment of Benchmark Regulation2013Metals 9%Wholesale lending 1 trillion of loans tocorporations by UK banks JuneBank of England bankstats, table A8.170% of these loans were toother financial institutionsMost common uses ofsyndicated loan financing 2015:Bank of England bankstats, table A8.147% general corporate21% acquisition10% refinancing6% project finance16% otherTransaction services 113 trillion payments and cashmanagement transaction in2015 (combined retail andwholesale)Bank for International Settlements (December 2016)Equity and debtPrimary market volumes 2015DealogicECM 72 billionDCM 271 billionSecondary marketsTraded in UK secondarymarkets, 2014: 13 trillion of equities 36 trillion of government debt 3 trillion of corporate debtTrax Markets, Fidessa Market share report (2014)

Investment managementStatisticTypes of portfolio operators:SourceInvestment Association Annual Survey (2015-2016)Operators of retail portfolios 20%AUMUK pensions fund portfolios 33%AUMUK institutional portfolios 10%AUMOverseas institutional portfolios37% AUMTypes of portfolio:Investment Association Annual Survey (2015-2016)42% collective portfolios58% segregated portfolios74% of AUM is managed usingactive strategies, versus 23% ofAuM managed in passivestrategies (and 3% in smartbeta)Investment Association Annual Survey (2015-2016)The UK is the second largestcentre globally for investmentdecision makingInvestment Association Annual Survey (2015-2016)UK share of global AUM 12%EFAMA, Asset Management in Europe (April 2015)4% of global AUM is domiciled inthe UKEFAMA, Asset Management in Europe (April 2015) 7 trillion of funds allocated tocapital markets on behalf of UKand overseas investorsInvestment Association Annual Survey (2015-2016)Retail investmentsStatisticSourceConsumers served:GFK Financial Research Survey (FRS), 6 months ending June2016 data.12.6 million British consumersDefinition: retail investments – any investment product, anyalternative investment (excluding property bought to let), unitlinked endowment, with profits endowment or Premium Bonds

Consumers served:9.1 million hold risk-basedinvestmentsConsumers served:3.9 million hold mare than 100,000 in investable assets(e.g. cash, ISAs)Consumers served:GFK Financial Research Survey (FRS), 6 months ending June2016 data.Definition: risk-based investments – any investment product,any alternative investment (excluding property bought to let),unit linked endowment or with profits endowmentImpact of the RDR on consumer interactions with the retailinvestments market, NMG (September 2014)Verdict Financial, part of GlobalData32% of total savings andinvestments are held by 0.6% ofthe populationAccess to retail investmentsHow consumers access retailinvestments:60% provider / 40% nonproviderFCA, Product Sales Data (Q2 2016)Products covered are: Bonds, Endowments, equity ISAs,SCARPs, Trusts and OEICsKey factsFCA calculation based on various sources: 1.8 trillion of retail investmentproducts held by UK consumers1. Nesta and University of Cambridge, Alternative finance report(2014). 2. Datamonitor (2015). 3. UK Government(2015). 4. Investment Association (2015) 5. NS&I website (Oct2015). 6. FCA returns data (2015). 7. FCA Supervisoryestimates, (2015).The stock sizes of investment bonds have been estimated basedon FCA Product Sales Data and PRA Life Insurance Returns; theyinclude unit-linked and with-profits bonds and endowments. CFDand FSB data estimated by FCA Supervision based on ClientMoney statistics and number of clients. Structuredproducts/deposits have not been included.Key factsHow consumers take investmentdecision:18% entirely advised55% partially advised27% entirely self directedPlatforum Consumer Insights (January 2016)

Key facts7.5% of British consumers nowhold an alternative investment(P2P / ETFs / mini-bonds / gold /collectibles)GFK Financial Research Survey (FRS), 6 months ending June2016 data.Definition: any ‘alternative investment’ (excluding propertybought to let)Retail bankingStatisticSource96% of adults in Great Britainhave a current accountGFK Financial Research Survey (FRS), 6 months ending June 2016dataGB population aged 16 yearsand over is approximately51.37 millionONS data and FCA calculation73 million personal currentaccountsGFK Financial Research Survey (FRS), 6 months ending June 2016data4 million business currentaccountsBBA, Bank Support for SMEs (Q2 2016)54% of adults in Great Britainhave a savings accountGFK Financial Research Survey (FRS), 6 months ending June 2016data69 million easy access savingsaccountsFCA Cash Savings Market Study (July 2014)87% personal current accountmarket share of the big six (thefive banking groups (LloydsBanking Group, HSBC,Santander, Barclays, RBSGroup) plus Nationwide)GFK Financial Research Survey (FRS), 6 months ending June 2016data85% business current accountmarket share of the big 5banking groups ((LloydsBanking Group, HSBC,Santander, Barclays, RBSGroup)Mintel, Small Business Banking (Oct 2016) 1,533.3 billion total retaildeposits balanceBank of England data, taken from Moneyfacts Treasury Report,October 2016.53% of payments madeelectronically in 2015*UK Payment Markets 2016, Payments UKContactless card payments aregrowing rapidly

228% growth in contactlesspayments in 2015*Card and automated payments

Triennial Central Bank Survey of foreign exchange and OTC derivatives markets in 2016, Bank for International Settlements (September 2016) 5,080 billion global physical commodity market – annual value of production, 2009-10 The EU Commission, Impact Assessment of Benchmark Regulation 2013 . Commodities annual value of production, 2009-10: Oil 47% Coal 17% Agriculture 16% Natural gas 11% .