CREDS 2.1 Application and purpose

With the exception of CREDS 2.2.14G to CREDS 2.2.17G and CREDS 2.2.65G to CREDS 2.2.70G, this chapter is not relevant to a credit union in relation to its benchmark activities.

The purpose of this chapter is to provide rules and guidance relating to senior management arrangements, systems and controls that are specific to credit unions.

1. (1)

   This chapter is also intended to remind credit unions that the Senior Management Arrangements, Systems and Controls sourcebook (SYSC) also contains a number of high level rules and guidance relating to senior management arrangements, systems and controls designed to have general application to all firms, including credit unions. Subject to the exceptions in (2) and (3) below, SYSC 1, SYSC 4 to SYSC 10 and SYSC 21 apply to all credit unions in respect of the carrying on of their regulated activities and unregulated activities in a prudential context. SYSC 18 applies to all credit unions in respect of both their regulated activities and unregulated activities.

2. (2)

   SYSC 4 to SYSC 10 and SYSC 14 do not apply to a firm (including a credit union) in relation to its carrying on benchmark activities (see SYSC 1 Annex 1 for the detailed rules on the application of SYSC 4 to SYSC 10).

3. (3)

   [deleted]

The purposes of SYSC, which applies to all credit unions, are:

1. (1)

   to encourage directors and senior managers to take appropriate practical responsibility for the arrangements that all firms must put in place on matters likely to be of interest to the FCA because they impinge on the FCA’s functions function under the Act;

2. (2)

   to reinforce Principle 3, under which all firms must take reasonable care to organise and control their affairs responsibly and effectively with adequate risk management systems;

3. (3)

   to encourage all firms to vest responsibility for effective and responsible organisation in specific directors and senior managers.