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Home > Financial Stability > Supervisory Approach

Supervisory Approach

In 2013 the Bank issued The Bank of England’s approach to the supervision of financial market infrastructure (FMI).

The document describes the Bank’s objectives in its supervision of FMIs, the approach the Bank will take to advancing them, key expectations that the Bank has of the systems it supervises, and how the Bank intends to assess systems against them.

By describing what the Bank seeks to achieve and how it goes about it, the document aids both accountability to the public and Parliament, and common understanding with regulated firms.

The Bank aims to keep the document materially up-to-date at all times, having them act as a point of reference for interested parties. The current version of the document can be found here:

April 2013

Supervisors are responsible for the identification and mitigation of risks.  Supervisors will use their judgement to assess systems, the risks they pose to financial stability, and whether they meet, and are likely to continue to meet, the relevant requirements. 

The Bank’s approach to supervision will be forward looking; supervisors will focus not only on current risks, but also on those that could plausibly arise further ahead. Where necessary, supervisors will intervene at an early stage to reduce these risks.

Supervisors will focus on the systems and issues that pose the greatest risk to the financial stability of the UK system. The frequency and intensity of supervision will be proportionate to the risk a system poses.

Collegiate supervision

Given the international nature of many FMIs, the Bank engages actively with its overseas counterparts. To support this, the Bank maintains co-operation agreements with overseas counterparts to enable the effective supervision of such cross-border FMIs, including the sharing of relevant confidential information.

The Bank also participates in supervisory colleges for FMIs of importance to the UK and chairs the colleges for UK FMIs.