The financial watchdog has published its business plan for the year ahead and it has set out five key priorities for the next 12 months.
One of the key areas the FCA will focus on for the investment management sector is a consultation on introducing a new prudential regime for MiFID investment firms, which create a more "appropriate" set of requirements for their business models than the existing CRD IV regime.
The regulator said the new regime with be aligned with the EU Investment Firms Directive and Regulation and is expected to be operational by 2020/2021. The consultation paper will be published in the second half of this year.
In its Business Plan 2019/20, the FCA said: "The new regime aims to reduce unnecessary costs to firms. It will include new rules and have implications for both our authorisation and prudential supervision of investment firms. There will also be changes to reporting requirements."
Looking at the industry as a whole, the FCA said its immediate priority was still to make sure it could help facilitate an "orderly transition" for financial services regulation after the UK leaves the European Union.
The body said it will continue to play a leading role in shaping global regulation and work with other regulators after Brexit.
The FCA said its other four priorities were to:
• Work on firms' culture and governance, which includes extending the Senior Managers and Certification Regime to all firms
• Ensuring the fair treatment of firms' existing customers by monitoring firms' practices, including the information they give prospective and current customers
• Developing the work being done on operational resilience, and
• Combating financial crime and improving anti-money laundering practices, by enhancing the use of technology and data, as well as engaging with multiple agencies and government bodies
The regulator also said it would continue to focus the areas where people are most susceptible to serious consumer harm: high-cost credit and retirement savings.
FCA chief executive Andrew Bailey said that, although Brexit is the most immediate challenge the regulator faces, its business plan has committed it to a "stretching" programme of work across the rest of financial services.
"In order to ensure we are a regulator that continues to serve the public interest, we need to adapt to the ever-changing environment," he continued.
"This is why the future of regulation is a key priority in this year's Business Plan. We will be leading a debate about this with stakeholders so that we can keep pace with the developments taking place in the markets that we regulate and in wider society."