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FSB: Further clarity on re exam statistics

06 June 2012 FSB

In an attempt to continue to keep its stakeholders informed, the Financial Services Board has issued a number of circulars urging Financial Service Providers (FSPs) to register for their regulatory exams. To this end the FSB released the first set of stat

To clear up any confusion that may have arisen as a result of this, it is important to understand that representatives and key individuals that are affected by the level 1 regulatory examination are spilt into two groups, according to the deadlines of their examinations.

• The first group (transitional group) is made up of people that have been in the industry prior to 2009, and should therefore write the level 1 examination by 30 June 2012, and pass it by 30 September 2012.

• The other group (new entrants) are those that only joined the industry from January 2010 and do not have to meet the above mentioned deadlines.

The statistics communicated in April 2012 were calculated based on all representatives and key individuals (transitional and new entrants) that are expected to write the level 1 regulatory examination. A distinction was not drawn between the two groups mentioned above, as the statistics for “new entrants” had not yet been finalised.

In May 2012, the exact number of “new entrants” was finalised, and these were excluded from that set of statistics. An explanation of this was detailed in the accompanying circular (circular 7 of 2012) which was released to the industry in May. This circular is available on the FSB website.

Below is a table recapping the exact number of FSPs that have written the exam and those that are yet to write:

Representatives

Numbers Affected

Representatives required to meet the June 30th deadline

62 835

Representatives that have written the exam

51790 – (82.42%)

Representatives that have passed the exam

35646 – (68.82%)

Representatives that must meet the June deadline

11045 – (18%)[i]

Representatives that are “new entrants” that do not have to meet the June deadline.

44899 – (41.67%)

The number of “new entrants” indicated above (those that joined the industry from January 2010) was calculated using data supplied by licensed FSPs. Although these “new entrants” are yet to write the regulatory examinations, this does not imply that they do not meet the “fit and proper” requirements in their respective fields.


In order to arrive at the total of 107 734 representatives reported, one must exclude the 44 899 individuals whose date-of-first-appointment provides for a different RE deadline timeframe.

The situation regarding the statistics pertaining to the key individuals is similar to that of the representatives.

The concern expressed by FAnews regarding the pass rates of those candidates that must complete the REs by the June deadline is shared by the FSB. The overall picture provided by the statistics does not take into account measures that are in place to address specific sectors of the industry and their examination obligations that are currently review.

The focus of the aforementioned statistics should perhaps be on the positive response from the industry to the regulatory examinations, knowing that, of the 11 045 reps and the 2 777 key individuals that must complete the REs by 30th June, these figures will reduce further by those individuals that are currently in the process of meeting the deadline.

The number of representatives that must complete the RE by the June deadline does not take into account the exam candidates that are currently in the process of writing.

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