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Relleen's capital markets pitch: reform is done, risk-taking is the next test

The FCA has declared the main phase of its wholesale market reform programme complete and is now pivoting to tokenisation, AI and private share trading. For senior leaders, the signal is that the regulator wants informed risk-taking back on the agenda, and expects firms to meet it.

Jon Relleen used the Reform of the UK Public and Private Capital Markets Summit on 5 October to draw a line under the FCA's multi-year wholesale reform programme and reframe the next phase around tokenisation, AI and private company share trading (FCA). The message to the room was that the regulator has done its structural work and now expects the market to use the headroom.

Key Executive Takeaways

  • The FCA says it has completed the major phase of UK wholesale market reform and is shifting focus to tokenisation, AI and private share markets, meaning firms should expect rulemaking to move from plumbing to product.
  • Firm trust in the FCA has risen sharply, with 79% highly satisfied with the relationship and a 27-point jump in understanding of the growth and competitiveness objective, giving executives a stronger basis to engage on commercial priorities.
  • Board-level change at the FCA and the Bank of England's enforcement body signals a more experienced, markets-literate supervisory bench, raising the quality bar for firm engagement on contested cases and strategic reform.

A regulator asking to be judged on growth

Relleen framed the programme around "reforming from a position of strength" and "rebalancing risk", stressing that "trust, market integrity and high standards set the foundations for sustainable growth, and it is crucial that we also enable informed risk-taking" (FCA). That phrasing matters. The FCA is explicitly inviting issuers, intermediaries and investors to take more risk inside the new rulebook, and is signalling it will treat that as evidence the reforms are working.

The timing is deliberate. Three days earlier, the FCA and Practitioner Panel survey showed 76% of firms rating the regulator as highly effective, up from 69%, with a 27-percentage point increase in firms' understanding of the Secondary International Competitiveness and Growth Objective and a 25-point rise in confidence in its delivery (FCA). Matt Hammerstein, chair of the Practitioner Panel, pushed the FCA to be "clearer about the outcomes it expects its priorities to produce, and more vocal about the progress it is making" (FCA). Relleen's speech reads as a direct response: here is the scoreboard, now play.

The governance signal behind the policy signal

The institutional changes around this message are not incidental. The FCA has added Lea Paterson CBE and Matthew Tobin as non-executive directors, with deputy chief executive Sarah Pritchard joining the Board from 1 October (FCA). Tobin's background advising HM Treasury on the Asset Protection Scheme, Credit Guarantee Scheme and the nationalisation of Bradford & Bingley brings crisis-era financing experience into the boardroom at exactly the moment the FCA is reopening risk tolerance.

In parallel, the Bank of England has appointed Carlos Conceicao and Alexander Justham to its Enforcement Decision Making Committee, with Justham bringing former London Stock Exchange and UBS Wealth Management UK experience to contested prudential and FMI cases (Bank of England). The combined effect is a more commercially fluent set of decision-makers across both authorities. Firms arguing the toss on enforcement, or lobbying on tokenisation rules, will face people who know how the trades actually work.

The counterweight firms cannot ignore

The growth pitch sits alongside a sharpened risk warning. The FPC's September record noted that interconnected vulnerabilities are more likely to crystallise together, with sovereign yields in advanced economies at levels not seen since 2008 and AI-related debt issuance broadening capital market exposure (Bank of England). The permission to take informed risk is being issued into a market the Bank considers more fragile, not less.

For boards, the practical implication is to treat the FCA's reform completion as a prompt to revisit capital markets strategy, particularly around private markets, tokenised instruments and AI-linked financing, while stress-testing those positions against the FPC's view of the cycle. The regulator has moved. The question is whether firms will be seen to have moved with it, or waited to be told again.

What this reveals

When a regulator publicly declares structural reform complete and invites firms to use the new headroom, the burden of judgement shifts from compliance teams to boards. Many leadership teams still carry an assumption, formed during years of restrictive rulemaking, that caution is the safe default; that assumption may now be the risk. The underlying problem this exposes is a lag between regulatory posture and internal risk appetite, where firms continue to behave as if the old supervisory climate applies while supervisors are actively scoring them on whether they take informed risk. Beyond the FCA perimeter, this is a reminder that regulatory signals about growth, competitiveness and risk-taking are themselves stakeholder expectations that boards must track and respond to.

Questions accountable leaders should ask

  • 01Does our current risk appetite statement reflect the FCA's shift toward informed risk-taking, or is it still calibrated to the pre-reform supervisory climate?
  • 02If a supervisor asked us to show where we have used the headroom created by wholesale reform, what evidence could we point to?
  • 03How confident are we that our board's read on FCA priorities around tokenisation, AI and private share trading matches what senior supervisors are actually saying in private?
  • 04Where in our business are we still declining opportunities on the assumption of regulatory resistance that may no longer exist?
  • 05Have we tested whether our executive narrative on growth and competitiveness lands with the specific supervisors who will judge us against the SICGO?

What accountable leaders should do now

  1. 1Commission a short board-level review of where internal risk posture may have drifted out of step with the FCA's current supervisory signals, particularly on wholesale markets, tokenisation and AI.
  2. 2Pressure-test the firm's stated growth and competitiveness narrative against what supervisors, trade bodies and informed market participants are actually saying, rather than relying on internal interpretation of published speeches.
  3. 3Identify two or three specific decisions in the pipeline where the old assumption of regulatory caution may be costing optionality, and reopen them with current evidence.
  4. 4Refresh the board's map of FCA decision-makers and influencers following the recent board and executive changes, so engagement is directed at the people who will actually shape the next phase.
  5. 5Build a standing mechanism for tracking supervisory signals between formal publications, so the gap between regulator posture and internal response narrows rather than widens.

Explore the practical guide

This guide identifies where board-level strategic thinking typically diverges from what supervisors actually care about in financial services, and how to spot and close those gaps before they become enforcement problems. After reading, you will be able to audit your own board papers and strategy documents for the specific blind spots regulators notice.

Read the guide

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