professional banker certificate

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PRA
Prudential regulation authority- oversees the stability of the prudentially significant firms.
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FCA
Financial conduct authority- regulation of conduct across the sector, ensuring that the relevant markets function well.
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EU regulations
direct form of EU law, they are binding throughout every member state. No amendments can be made to the regulations.
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EU directives
passed by the European parliament have a potential impact on all European Member states. After a directive is passed it is up to the state to pass national legislation in order to comply with the provisions, within 2 years.
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MiFID
Markets in financial instruments directive- adopted by the European council in 2004 and is part of the European financial services action plan (FSAP) designed to help integrate Europe’s financial markets.
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Basel 1
1988 helped to strengthen the soundness and stability of the international banking system as a result of the higher capital ratios that it required.
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Basel 2
revised framework 2007- implemented in the European Union via the capital requirements directive (CRD).
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Pillar 1
minimum capital requirements firms will be required to meet credit, market and operational risk
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Pillar 2
appropriate system of governance with firms and supervisors having to take a view on whether a firm should hold additional capital against risks not covered in pillar 1.
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Pillar 3
improve market discipline by requiring firms to publish certain details of their risks, capital and risk management.
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Basel 3
developed in response to the inadequacies of financial regulation revealed by the 2007 financial crisis. Implementation is over 2013- 2021 period.
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consumer credit directive
EU directive came in to effect in 2011.
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consumer credit act 2006
gave consumers the right to use the financial ombudsman service and allowed borrowers to challenge unfair debtor/creditor relationships in court.
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restricted use (credit agreements)
applying to the acquisition of goods and services
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unrestricted use (credit agreements)
applying to obtain cash loans that can be used for any purpose
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APR
- (annual rate of return) - measure of the true cost of borrowing.
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cooling off period
the time where the customer has the right to cancel the regulated agreement within a short time after it has been executed.
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Payment Services Directive (PSD)
introduces an authorisation and registration regime for a newly created category of frim called payment institutions.
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Banking Conduct of Business Source book (BCOBS)
the FCA me the requirements of the PSD through this.
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Payment services regulator
economic regulator of the UK payment systems industry. A subsidiary of the FCA with its own objectives and governance arrangements.
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Anti-Money laundering measure (AML)
risk based approach that is mandatory under MLR 2007.
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Placement
where cash proceeds of money laundering activity first enter the financial system
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layering
a series of multiple transactions designed to hide the original source of the money.
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integration
the funds are allowed to be withdrawn without further suspicion.
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risk based approach
highly prescriptive approach, acknowledges that risks are different for each firm. Needs to be part of firm’s philosophy and reflected in procedures and controls. Clear communication of policies across the firm. Robust mechanisms.
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Know your customer (KYC)
Involves CDD, SDD and EDD (PEP’S) to verify a customer’s identity.
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money laundering reporting officer
receives reports of transactions of suspicion of money laundering, determines whether the suspicion gives rise to suspicion. If they suspect money laundering they must report it to the national crime agency (NCA).
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Data protection act 1998
data must be registered with the information commissioner’s officer and must comply with data protection provisions.
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Bribery act 2010
section1- active bribery, section 2- passive bribery, section 6- bribing a foreign official, section 7- failure of firms to prevent bribery.
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corporate governance
ways in which organisations are directed and controlled and how their affairs are handled by the board of directors and the employees.
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UK corporate governance code
the financing reporting council (FRC) is the independent regulator responsible for promoting high-quality corporate governance and reporting in the UK. The code sets out standards of good practice in relation to board leadership and effectiveness, re
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compliance department
every bank will this, and the main purpose is to ensure that policies and practices are consistent with the practices of the law, codes of practice and in-house policies.
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risk teams
integrate compliance and operation risk programmes, recognising that greater efficiency and effectiveness may be gained by centralising the overseeing of these functions.
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void contract
where the flaw is serious and the contract is treated as if it had never existed.
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voidable contract
-where the flaw is less serious. The contract is initially valid but one party can rely on the flaw and ask the court to set the contract aside. If neither party takes action the contract will remain valid.
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bilateral common error
Where both parties enter into a contract with the same mistaken belief.
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error in substantials
automatically results in the contract being declared void because of- price, identity of parties, nature of contract, subject matter, quality, quantity or extent of subject matter.
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error concomitans
if an error occurs for any other reason, contract is valid.
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innocent misrepresentation
errors caused by something the other party has said or done accidentally.
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fraudulent misrepresentation
errors caused by something the other party has said or done deliberately.
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express consent
agency expressly constituted by verbal or written consent.
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implied consent
not verbally or written but by inference form the conduct of the parties. E.g. in partnerships.
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holding out
if a principle has had an agent conducting business on their behalf on a regular basis in the normal course of business, the principle cannot decide to subsequently withdraw from any transaction the agent has entered into.
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ratification
when a person has acted on behalf of another person but has no authority to do so., the party whom the act was done may later ratify the act.
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necessity (agent)
arises in an emergency when a person becomes justified in appointing to themselves the powers of an agent.
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negotiable instrument
a transferable, signed document that promises to pay the bearer a sum of money at a future date or on demand.
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memorandum of assosication
must include statement that the company has been formed and a statement that the subscribers have taken at least one share of a specified value in the company.
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article of assosiation
- forms the basis of the member’s relationship with the company and also governs the relationship of the members with each other. A contract between the shareholders and the company.
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joint and several liability
joint liability- each party is liable for the full amount of a debt or obligation. Several liability- the parties are liable only for their respective obligations.
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Other cards in this set

Card 2

Front

Financial conduct authority- regulation of conduct across the sector, ensuring that the relevant markets function well.

Back

FCA

Card 3

Front

direct form of EU law, they are binding throughout every member state. No amendments can be made to the regulations.

Back

Preview of the back of card 3

Card 4

Front

passed by the European parliament have a potential impact on all European Member states. After a directive is passed it is up to the state to pass national legislation in order to comply with the provisions, within 2 years.

Back

Preview of the back of card 4

Card 5

Front

Markets in financial instruments directive- adopted by the European council in 2004 and is part of the European financial services action plan (FSAP) designed to help integrate Europe’s financial markets.

Back

Preview of the back of card 5
View more cards

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