Five British financial services trade associations, including the British Bankers' Association (BBA) and Payments UK, are set to merge to give them more lobbying clout and to cut costs. Britain's banks proposed earlier this year merging nine associations and set up a panel to review options, which on Friday proposed bringing together five bodies and creating close ties with two more.
The panel proposed merging the BBA, Payments UK, the Council of Mortgage Lenders, the UK Cards Association and the Asset Based Finance Association. Nine of Britain's big banks, including HSBC, Lloyds and Barclays, and building society Nation-wide last year told the trade associations they needed to consider merging as they often duplicated lobbying efforts. They also said the associations needed a stronger voice on European regulation and should also cut costs.
"A new trade association would be able to represent the industry more effectively because its voice would carry greater weight," Ed Richards, the former communications regulator who was appointed to lead the review, said. "Having a single point of contact will also be welcomed by policymakers and will reduce duplication of effort." The review also said the new group could cut trade association fees by up to 30 percent.
The Centre for the Study of Financial Innovation think-tank has estimated banks spend upwards of 50 million pounds ($76.25 million) on the top 10 trade associations they belong to. The think-tank has also found significant overlap in membership of trade associations, with about 60 percent of UK Payments Council members also members of the BBA. The review said the new group would become a close partner with UK Payments Administration and Financial Fraud Action UK. The Building Societies Association and the Finance & Leasing Association said they did not want to join the group. The review did not propose including some other groups it had previously considered for the merger. The trade groups are expected to vote on the merger by the end of February and the new association is expected to be launched in May and be fully operational by November 2016.
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