Strong and prudent management
As a UK Bank we are authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.
Our customers have the additional reassurance that eligible deposits with Cynergy Bank are protected by the Financial Services Compensation Scheme.
‘Ring-fencing’ and what it could mean for you.
Following the financial crisis which began in 2007, UK legislation was passed to better protect customers and the day to day banking services they rely on. The legislation requires each large bank to separate services like current accounts, savings accounts, and payments from risks in other parts of the business, for example in investment banking.
This separation is called ‘ring-fencing’. It means that large banks may need to change the way they are structured.
Cynergy Bank is not currently required to make any such changes based on the size of our deposits. We may decide to opt-in to any changes voluntarily, either now, or in the future. We will continue to carefully consider what is best for our customers and will keep you updated.
In the meantime, we feel it is important that our customers who may have accounts with other banks understand exactly what is happening regarding ‘ring-fencing’, so that they are protected from any potential increase in attempted fraud during this period of change.
To help you, please carefully consider the following which is based on a message we have received from the UK Financial Conduct Authority (FCA):
You do not need to take any action unless you are contacted by your bank. If you are affected by the changes, your bank will tell you how, when the changes take place and whether you need to do anything.
Customers of different banks may be affected in different ways. Even similar customers of the same bank may be affected in different ways.
Some bank customers will experience changes to their account details. For example, some customers may receive a new sort code. Some will also receive a new account number. If you are affected in this way, your bank will ensure that any outgoings payments, for example standing orders and Direct Debits, are made as normal. Your bank will redirect to your new account details any incoming payments made to your old account details.
All bank customers should remain alert to the possibility of fraud:
- Treat all letters, phone calls, emails and text messages with caution. Don’t assume they are genuine, even if the person seems to know some basic information about you.
- Do not give out your account or card details or make changes to payments unless you are certain who you are dealing with.
- Never disclose security details, such as your PIN or online banking password. Your bank or other genuine organisations will never ask you for these.
- Don’t be rushed or pressured into making a decision or acting quickly. A genuine bank or other organisation won’t mind waiting if you want time to think.
If you have any doubts at all about what you are being asked to do, check with your bank. Always use contact details you can trust, for example the phone number on your bank statement, rather than any details provided in the communication in question
As a Cynergy Bank customer, if you receive a contact that you weren’t expecting or one that appears unusual, asking you to do something because of ‘ring-fencing’ and you are suspicious that it might be fraudulent, please contact us.
Treating Customers Fairly
At Cynergy Bank, the Fair Treatment of Customers (TCF) sits at the heart of our business. It is our responsibility to you, our customers, to provide you with clear and fair financial products and services that meet your reasonable expectations and needs.
The Financial Conduct Authority (FCA) expects firms like Cynergy Bank to keep the well-being and fair treatment of all its customers, especially those in vulnerable circumstances, central in the way they operate. To help firms to achieve this, the FCA have six TCF outcomes to demonstrate what TCF looks like:
Outcome 1: Consumers can be confident they are dealing with firms where the fair treatment of customers is central to the corporate culture.
Outcome 2: Products and services marketed and sold in the retail market are designed to meet the needs of identified consumer groups and are targeted accordingly.
Outcome 3: Consumers are provided with clear information and are kept appropriately informed before, during and after the point of sale.
Outcome 4: Where consumers receive advice, the advice is suitable and takes account of their circumstances.
Outcome 5: Consumers are provided with products that perform as firms have led them to expect, and the associated service is of an acceptable standard and as they have been led to expect.
Outcome 6: Consumers do not face unreasonable post-sale barriers imposed by firms to change product, switch provider, submit a claim or make a complaint.
Cynergy Bank works to achieve these outcomes in the following ways;
- The Directors, Senior Managers and staff are responsible for ensuring that TCF outcomes are effectively managed within their area. This includes working to ensure that everyone in the Bank understands how their conduct can deliver good TCF outcomes.
- We aim to demonstrate the achievement of TCF outcomes in regular reporting under the FCA’s Senior Management Systems & Controls arrangements. This reporting is also subject to monitoring by the Bank’s Compliance department.
- We ensure that our staff are kept up to date with relevant training and competencies, data protection and other matters directly affecting the quality of service offered to customers.
- We recognise that we must continue to ensure that TCF is integral to each stage of the product lifecycle, from promotion right through to our after sales service.
- The Bank aims to describe the different products it offers clearly to ensure customers understand their features and benefits as well as the risks and costs involved so they can make informed decisions about which products are right for their needs.
- We look to ensure that we engage with our customers in a manner that is open and transparent, and with communications that are fair, clear and not misleading.
- We ensure that customer complaints are assessed fairly, promptly and impartially, and in line with FCA deadlines and rules.
- We encourage after sales contact with customers, where appropriate, to correct or improve on the service already offered.
- Where the Bank delegates an activity which impacts its customers, distributors or other third parties, to a regulated company or otherwise, the Bank looks to ensure that the principles of TCF are maintained by that delegate.
- The Bank aims to act consistently with applicable guidance around TCF from the FCA and, where appropriate, other industry bodies.
We continue to refine our TCF Policy to incorporate best practice and act on the relevant management information to ensure that all our customers, remain at the heart of our business.
Cynergy Bank Limited (the “Bank”) is authorised by the Prudential Regulation Authority (PRA) and regulated by the Financial Conduct Authority (FCA) and the PRA.
Board of Directors
The Board of Directors has ultimate responsibility for the prudent management of the Bank and oversight of senior management. Its terms of reference include:
- Establishing a sustainable business model and a clear strategy consistent with that model
- Reviewing, challenging and approving strategic plans (and their underlying assumptions and rationale) and annual budgets after review by Group senior management
- Ensuring the adoption and maintenance of high standards of corporate governance
- Ensuring that management maintains an appropriate system of internal controls which provides assurance of effective operations, internal financial controls and compliance with the rules and regulations
- Setting corporate values and standards, with due regard to treating customers fairly and ethical leadership
- Reviewing and overseeing the effective implementation of the Remuneration Policy
- Approving new products and material changes to existing products
The Chair is a non-executive director. Members of the Board of Directors are appointed by the Board on the recommendation of the Nominations and Corporate Governance Committee and following the agreement of the Board of Directors of the parent.
The Board of Directors has delegated a number of its responsibilities to four board committees. These are:
The Audit Committee is responsible for ensuring the integrity of the Bank’s financial statements and any other announcements on financial performance. Its terms of reference include:
- Reviewing the adequacy of provisions for bad debts and other provisions
- Reviewing the adequacy of capital and liquidity in the light of the results of stress testing
- Monitoring the effectiveness of the Bank’s internal quality control and risk management systems and its internal audit
- Receiving and considering internal audit reports and approving the internal audit plan
- Appointing the external auditors and approving their remuneration
The Risk Committee advises the Board on the Bank’s current and future risk appetite and assists the Board in overseeing the implementation of strategy. Its terms of reference include:
- Reviewing internal control systems
- Monitoring regulatory compliance and important regulatory correspondence
- Reviewing whistleblowing arrangements
- Challenging executives on major decisions involving risk management and risk-taking
- Ensuring that the Bank’s risk profile and risk appetite remain appropriate
- Reviewing the Bank’s internal assessment of capital and liquidity adequacy
Nominations and Corporate Governance Committee
The Nominations and Corporate Governance Committee makes recommendations for senior appointments, oversees succession planning and monitors corporate governance arrangements. Its terms of reference include:
- Recommending appointments to the Board and the Executive Committee
- Reviewing corporate governance arrangements and making appropriate recommendations to the Board of Directors
- Monitoring the composition of the Board of Directors to ensure that a broad set of skills and experience are represented and that there is a strong independent element on the Board
- Agreeing targets for appropriate gender balance on the Board
- Ensuring that directors have sufficient time to perform their duties effectively
- Ensuring that there are adequate resources for the induction and training of members of the Board
- In performing its duties, and to the extent possible, taking account of the need to ensure that the Board's decision-making is not dominated by any one individual or small group of individuals
- Overseeing the annual performance evaluation of the Board and its sub-committees, including annual assessment of the effectiveness of the Chair and individual executive and non-executive directors
- Reviewing the Nomination process in relation to the appointment of senior management and making recommendations to the Board, where necessary
Human Resources and Remuneration Committee
The Human Resources and Remuneration Committee is responsible for managing human resources risk and remuneration. Its main objective is to ensure the Bank’s practices in relation to remuneration comply with the Dual-Regulated Remuneration Code. Its terms of reference include:
- Approving the Bank’s Remuneration Policy
- Monitoring the performance of Senior Management
- Reviewing the results of performance reviews and approving the budget for pay awards and the design of any variable pay arrangements
- Approving recommendations on the remuneration of the Executive Directors and employees identified as material risk takers
Senior Managers Regime
The Bank complies with all aspects of the UK Senior Managers Regime, which requires the assessment of the suitability of members of the Management Body.
Pillar 3 Disclosures
For the year ended 31 December 2019
Pillar 3 Disclosures
For the year ended 31 December 2018
- The Bank’s senior management are committed to preventing bribery and to maintaining an ethical bank that competes fairly and openly in the market place.
- The Bank has a zero tolerance approach to bribery. Staff and others acting for or on behalf of the Bank must not offer, give, seek or accept a bribe.
- The Bank has adopted a formal anti-bribery policy and ensures that staff and those performing services for the Bank are made aware of this policy and are periodically reminded of it. Staff receive regular training on anti-bribery and are required to report any bribery that comes to their attention involving the Bank or its employees, agents or subsidiaries.
- The Bank maintains procedures to:
- carry out due diligence checks before appointing new employees or agents;
- ensure that any corporate hospitality given or accepted is proportionate and reasonable.
- This policy and the steps the Bank has in place to tackle bribery will be kept under regular review and will be updated at least annually, and more frequently when appropriate.
Gender pay gap reports
See below for our most recent gender pay gap report.
Cynergy Bank Limited: Tax Strategy
In relation to Financial Year ending 31 December 2020
Cynergy Bank Limited (the “Bank”) manages its UK tax affairs. The primary objective of the Bank when managing its tax position is to support the Bank’s strategy whilst ensuring compliance with tax laws and filing obligations.
The Bank manages its tax affairs based on the following principles:
- Compliance with all relevant laws and disclosure obligations;
- Arranging its commercial affairs in a tax efficient manner and only engaging in tax planning that supports genuine commercial activity;
- Implementing and maintaining controls and procedures relating to all taxes to ensure the correct and fair amount of tax is paid in a timely manner;
- In line with the UK Government’s Code of Practice on Taxation for Banks (the “Code”), not promoting arrangements to other parties unless the Bank is confident that the tax result of those arrangements is not contrary to the intentions of Parliament;
- Establishing and maintaining appropriate tax accounting arrangements; and
- Keeping an open, professional and transparent relationship with HM Revenue & Customs (“HMRC”).
Tax Risk Management & Governance
The Board of Directors is ultimately responsible for the management of the Bank’s tax affairs and is supported in doing so by the Board Audit Committee in reviewing and monitoring material tax issues and judgements.
Day to day operational tax activity sits with the Finance team. Tax advisory services are provided to the Bank by the Board approved external tax advisors. The Finance team apply professional diligence and care in the management of all risks associated with tax matters, and ensure governance and assurance procedures are appropriate and that processes and systems are in place that ensure that all tax risks and issues are identified and properly mitigated. These activities include compliance and risk monitoring as well as internal audit reviews.
All tax compliance arrangements are subject to both internal and external review by the external tax advisors, along with further advice from the external tax advisors in respect of any law changes, changes of approach or tax authority enquiries.
As a signatory of the Code the Bank has adopted the principles contained therein. Appropriate processes and controls have been put in place to ensure compliance with the Code.
The Finance team reports to the Risk Committee on the current status of the tax risks faced by the Bank, the control environment in respect of tax, impact of any future legislative changes and compliance with the Code.
Attitude to Tax Planning
In making commercial decisions in pursuit of its overall strategy, and ensuring that returns to shareholders are optimised, tax is one factor that will be considered. All tax planning must support genuine commercial activity and not be contrived or artificial. All such activities must comply with both the letter and legislative intent of relevant tax law and practice and not be designed to achieve tax results that are contrary to the intentions of Parliament.
Appropriate review and analysis is carried out of all new products or services and related business change by appropriately qualified staff to ensure the objectives above are met. Where there is uncertainty as to the application or interpretation of tax law, appropriate written advice evidencing the facts, risks and conclusions may be taken from external advisors to support the decision making process.
The Bank will access government sponsored tax incentives where appropriate, e.g. Research and Development tax credits.
The level of tax risk the Bank is prepared to accept
The Bank’s approach to tax risk is integrated within its broader business risk management framework. The Bank does not involve itself with complex tax structures. The tax environment and tax compliance regulations are constantly changing and can give rise to new tax risks and the Bank actively seeks to identify, evaluate and manage these risks.
Approach to dealing with HMRC
The Bank is committed to maintaining an open, constructive and transparent relationship with tax authorities based on the concepts of integrity, collaboration and mutual trust. All dealings with tax authorities and other relevant bodies will be conducted in a collaborative, courteous and timely manner.
The Bank strives for early agreement on disputed matters, to achieve certainty wherever possible, to focus on significant issues, and seeks to resolve issues before returns are filed whenever practicable. In complying with the Code the Bank will seek to disclose fully any significant uncertainties in relation to tax matters.
The aforementioned tax strategy/policy complies with the UK legislative requirement under paragraph 16(2) Schedule 19 Finance Act 2016.
Statement of Commitment to the UK Money Markets Code
14 February 2019
Cynergy Bank Limited hereby acknowledges that the UK Money Markets Code (“the Code”) represents a set of principles generally recognised as good market practice in the UK Money Markets. The Institution confirms that it is a UK Market Participant as defined by the Code, and has committed to conducting its UK Money Market activities in adherence with principles of the Code.
Specifically, in a manner that is commensurate with the size and nature of its UK Money Market activities, the institution has established and implemented policies and procedures that accord with the Code (in so far as the content does not conflict with applicable law). Appropriately senior management will review these regularly to ensure their continued relevance and effectiveness.
Head of Treasury
We will meet and where possible exceed current and future environmental legislation and regulatory requirements.
We will look towards best practice to see where we can reduce our environmental impacts of our activities and policies.
We will ensure employees are aware of environmental legislation and operational procedures.
Natural Resources and Waste
We will monitor, manage and reduce the Bank’s use of water.
We will minimise the amount of waste produced by the Bank and encourage greater reuse, recycling and composting.
We will use the least environmentally damaging goods and services where possible.
We will minimise harm from land which is contaminated or polluted, including the prevention of pollution
We will reduce greenhouse gas emissions, notably carbon dioxide and methane.
We will ensure, where possible, buildings and services are able to adapt to climate change.
We will monitor, manage and minimise the Bank’s use of energy.
Education, Implementation and Monitoring
We will consider environmental factors in all of the Bank’s decisions and activities.
We will continually develop environmental objectives and targets and introduce best practice to reduce environmental impacts.
We will educate and train employees to conduct their activities in an environmentally responsible manner.