How to Conduct Effective Wind-Down Planning.

This presentation provides a step-by-step guide to conducting Wind-Down Planning in line with FCA expectations. It explains why having a robust plan is essential for ensuring business continuity, protecting consumers, and meeting regulatory obligations. Learn how MEMA Consultants helps firms design and implement effective wind-down strategies to minimize risk and maintain compliance during business closure or restructuring.

1. Wind Down Planning
Master the FCA's guidance on conducting effective wind-
down processes for your firm.

2. FCA Review Findings
The FCA completed a thematic review of wind-down
processes across multiple business models, examining
liquidity, intragroup dependencies, and wind-down triggers.
Widespread Weaknesses
Most firms lack mature
winddown planning and
documentation.
Applies Broadly
Observations from large
firms apply to all
regulated businesses.
Key Priority
Disorderly wind-down is a significant driver of harm.

3. Appropriately recognize wind-down triggers within your framework.
Risk Management Integration
Wind-down planning must be embedded into your risk
management framework during FCA authorisation. Most
firms' risk management and wind-down planning showed
substantial gaps and lacked maturity.
Identify Triggers
Consider risks to your business during authorisation.
Assess Risks
Integrate wind-down scenarios into risk assessments.
Plan Ahead

4. Capital and Liquidity Assessment
A significant FCA observation: firms focus on capital needs during wind-down but neglect liquidity. Your
cash position may change substantially, requiring sufficient liquid holdings to fund an orderly wind-down.
Traditional focus of wind-down planning.
Capital Needs
Often overlooked but critical for operations.
Liquidity Needs

5. Intragroup Dependencies
Assess the impact of group membership on wind-down planning. While firms view interconnectivity
positively, most haven't considered stress from parental failure or group-wide disruptions
Interconnectivity
Map dependencies and shared
resources.
Stress Scenarios
Test impact of parental or peer
failure.
Resilience
Build safeguards for group-wide
disruptions.
Group Structure
Understand your firm's position
within the group.

6. Testing and Credibility
Testing wind-down plan outcomes demonstrates credibility to
your Board and the FCA. This validation proves the plan and
process are operationally feasible and realistic.
Execute stress tests and simulations.
Confirm operability and feasibility.
Develop comprehensive wind-down scenarios.
Design Plan
Run Tests
Validate Results
Demonstrate credibility to stakeholders.
Build Confidence

7. Proportional Implementation
The FCA expects wind-down planning exercises to be proportional
to your firm's scale, nature, and complexity. Use FCA observations
to tailor your plan effectively to regulatory requirements.
Match planning depth to
firm size and operations.
Scale
Align with your specific
business model.
Nature
Address interconnections and dependencies.
Complexity

8. Next Steps
Strengthen your wind-down planning with expert
guidance. Contact MEMA today to tailor your plan to
regulatory requirements and ensure business resilience.
Reach out to our compliance
team for personalized support.
Get in Touch
Leverage our regulatory
expertise and best practices.
Expert Guidance
Bridge compliance and business excellence.
Secure Solutions
For more information visit our full blog at: MEMA Consultants