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Home > Prudential Regulation Authority > 2014 and 2013 updates

2014 and 2013 updates

Capital Requirements Directive IV  |  Updates  2015 updates 2014 and 2013 updates

December 2014
On 16 December the EBA published its consultation on the revised Liquidity Coverage Ratio (LCR) template. This consultation paper proposes to amend the existing COREP LCR template that firms are currently reporting. Significant changes are required to the existing LCR template and instructions as a result of the European Commission’s Delegated Act specifying the LCR. The deadline for sending comments to the consultation is 10 February 2015. The PRA considers it useful for firms to use the consultation to begin to think about their own preparations for implementation of the revised LCR template. The EBA has also published an ‘LCR calculation tool’ that is intended to provide a practical application of the revised LCR template and instructions.

On 12 December 2014, the PRA stated that it plans to start collecting intraday liquidity data on a more systematic basis to inform its assessment of intraday liquidity risk in normal and stressed conditions. UK banks, building societies and designated investment firms are already required to measure, monitor and actively manage intraday liquidity risk under BIPRU 12.3.17R and BIPRU 12.5.26 and the data collection will be building on this requirement to enable supervisors to monitor firms’ ability to meet payment and settlement obligations on a timely basis. (The PRA is consulting in CP27/14 ‘CRD IV: Liquidity’ on moving these rules into the new PRA Rulebook – see 28 November 2014 update below.)
The PRA intends to ask UK banks, building societies and designated investment firms to start reporting information on their intraday liquidity positions from 1 July 2015. The PRA will not necessarily collect data from firms where supervisory priorities and the firm’s risk profile do not justify the data collection. The PRA will discuss the proposed data collection exercise, including the form, frequency and content of the data that will be sought from the relevant firms, through regular PRA supervisory engagement. The PRA intends to stop collecting the data if and when intraday liquidity reporting is fully harmonised in the EU.
The PRA’s intraday liquidity data template is closely aligned with the Basel Committee on Banking Supervision ‘Monitoring Tools for Intraday Liquidity Management’, published in April 2013.
On 12 December 2014, the PRA published two reporting clarifications to be applied by firms for reporting from 2015 Q1. These are technical clarifications where the PRA has discretion to determine prudential standards and are therefore not specified in the instructions in the implementing technical standards for the COREP templates.
November 2014
On 28 November 2014, the PRA published CP27/14 ‘CRD IV: Liquidity’ seeking views on draft rules and a draft supervisory statement on the PRA's proposed update to its liquidity regime. This consultation is relevant to banks, building societies and PRA-UK designated investment firms. It is also relevant to UK branches of non-EEA credit institutions, and UK branches of EEA credit institutions.
October 2014
In October, the PRA wrote to firms setting out the EBA’s recommendation to obtain a Legal Entity Identifier and inform the PRA by Friday 5 December 2014 if they have been unable to comply. More information is available in the letter.
On 27 October 2014, the PRA published its policy statement , rules and supervisory statements for CRD IV-related updates in the areas of credit risk mitigation, credit risk, governance and market risk.
On 10 October 2014 the European Commission adopted a Delegated Act which lays down a full set of rules on liquid assets, cash outflows, cash inflows needed to calculate the precise liquidity coverage requirement. Further information on the Delegated Act can be found on the European Commission’s website.
September 2014
On 30 September 2014, the PRA issued clarification of reporting instructions for EBA template C04 relating to own funds requirements related to Pillar II adjustments. The PRA is aware that the instructions for template C04 are not being interpreted consistently, and the PRA is unable to use data from many of the early submissions. NOTES UPDATED - see update on 10 May 2016.
On 23 September 2014, the PRA issued interim clarifications of reporting instructions for EBA templates C28 and C29 relating to Large Exposures. The PRA is aware that the instructions for templates C28 and C29 are not clear, and the PRA is unable to use data from many of the early submissions. The PRA is working with the EBA to clarify the instructions. While awaiting EBA’s revised instructions, the PRA issued interim clarifications.
Clarification of procedures for completion of COR002 Large Exposures templates

April 2014
On 30 April 2014, the PRA published its policy statement, rules and supervisory statement on CRD IV capital buffers.
On 16 April the Commission adopted the Reporting ITS and both they and the EBA issued communications in relation to: i) the delays to Q1 COREP remittance dates; and ii) implementation of asset encumbrance reporting and Commission adoption of Reporting ITS. More information regarding the above is available on the EBA and European Commission websites - see External Links.
December 2013
On 19 December 2013, the PRA published its rules and supervisory statements which complement the EU legislative package.