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Law360, London (March 4, 2020, 6:04 PM GMT ) The Financial Conduct Authority on Wednesday said it will be reviewing contingency plans penned by banks and insurers in response to the new coronavirus, the latest guidance by a British authority as the spread of the virus shows no sign of waning.
The financial watchdog said it is working with the Bank of England and the Treasury to ensure that financial services companies are taking steps to meet their regulatory obligations despite the outbreak of the COVID-19 virus.
The FCA said it is reviewing contingency plans at a wide range of financial companies to assess the operational risks posed by the outbreak. It will check that banks, insurers and asset managers can continue to operate and serve their customers in spite of the virus.
"We expect firms to take all reasonable steps to meet their regulatory obligations," the U.K. regulator said in guidance to the market on Wednesday. "For example, we would expect firms to be able to enter orders and transactions promptly into the relevant systems, use recorded lines when trading and give staff access to the compliance support they need."
The FCA said that finance companies can undertake their regulatory activities at "backup sites" or staff can work from home if needed.
The watchdog also said that it is discussing and attempting to resolve issues at individual companies. It added that it will keep its guidance under review.
"We want to understand the pressures they are facing and will be continuing our active dialogue with firms, institutions and industry bodies in the coming days and weeks," the regulator said.
The guidance comes as departing Bank of England Governor Mark Carney warned on Tuesday that the coronavirus outbreak could cause economic shock. Carney told members of Parliament during a Treasury Select Committee meeting on Tuesday that the central bank will "take all necessary steps to support the U.K. economy and financial system," including with contingency plans.
The Financial Reporting Council, the U.K.'s audit watchdog, told companies in February to identify and inform their investors of the main risks to their operations from the outbreak, especially if they have branches in China. The FRC said at the time that it is talking to audit firms about the impact of the virus on their work.
--Editing by Tom Mudd.
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