Market infrastructure - UK


Institutions and organisation

Stock Exchanges

  • The London Stock Exchange (LSE)
    The LSE is the national Stock Exchange for the United Kingdom. It maintains an electronic order book known as the Stock Exchange Trading Service (SETS).
  • Techmark
    Techmark is the LSE market for innovative technology companies. It went live in November 1999 with over 180 companies from across the main market.
  • London International Financial Futures (LIFFE)
    Liffe contracts in a large range of international short-term Interests Rates, Government Bonds, Individual Equity and Equity Indices and Commodities.
  • Other exchanges
    • The London Securities and Derivatives Exchange;
    • The London Metal Exchange (LME);
    • Energy Future and Options Exchange (IPE);
    • The London Securities and Derivatives Exchange (OMLX).

CSDs and Clearing Agencies

  • Euroclear UK & International Ltd (EUI)
    EUI owns and operates the UK’s settlement system, CREST.
  • The London Clearing House (LCH)
    LCH acts as the central counterparty not only for the Central Counterparty for Equities Service (LCH EquityClear) but also for trades executed by its members on LIFFE, LME and IPE and also in certain classes of over-the counter products, especially interbank interest rate swaps (LCH SwapClear) and repo and cash trades in European government bonds and Pfanbriefe (LCH RepoClear).

Central Bank and Payment Systems

  • Central Bank: Bank of England;
  • CHAPS Sterling: RTGS system for large-value payments in GBP:
  • CHAPS Euro: launched in 1999 for euro-denominated payments, is connected to TARGET.

Regulatory structure

On 1 April 2013, the Financial Services Authority (FSA), previously the statutory regulator for the insurance, investment business and banking industries, was replaced by two new regulators:

  • The Financial Conduct Authority (FCA)
    The FCA is the regulator of the financial services industry in the UK with primary objectives to maintain and ensure the integrity of the market, regulate financial services firms so that they give consumers a fair deal and ensure that the financial services market is competitive.
  • The Prudential Regulation Authority (PRA)
    The PRA is responsible for the prudential regulation and supervision of banks, building societies, credit unions, insurers and major investment firms. In total, the PRA regulates around 1,700 financial firms.
    The Prudential Regulation Committee (PRC), is the governing body of the PRA as part of the Bank of England and it is responsible for making the most important supervisory and policy decisions within the PRA.
    The role of the PRA is defined in terms of two statutory objectives: to promote the safety and soundness of the firms covered by its remit and, specifically for insurers, to contribute to the securing of an appropriate degree of protection for policyholders.
    In promoting safety and soundness, the PRA focuses primarily on the harm that firms can cause to the stability of the UK financial system.

Both the FCA and the PRA were created by the Financial Services Act (2012) and form part of the Bank of England.

In addition, a new Financial Policy Committee (FCP) was established within the Bank of England to identify, monitor and take action to remove or reduce systemic risks with a view to protecting and enhancing the resilience of the UK financial system. A secondary objective of the FPC is to support the economic policy of the government.