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Home > Prudential Regulation Authority > Strengthening individual accountability in banking: UK branches of non-EEA banks – PS29/15
 

Strengthening individual accountability in banking: UK branches of non-EEA banks – PS29/15

16 December 2015

Overview

This policy statement (PS) sets out the Prudential Regulation Authority’s (PRA’s) final rules on the application of the Senior Managers and Certification regimes (SM&CR) to UK branches of non-EEA banks and PRA-designated investment firms (non-EEA branches).

On 13 August 2015 the PRA published PS20/15: ‘Strengthening individual accountability in banking: UK branches of non-EEA banks, which provided feedback on CP9/15: ‘Strengthening accountability in banking: UK branches of foreign banks’.

PS20/15 included a set of final rules for extending the SM&CR to non-EEA branches which the PRA was able to make using its general rulemaking powers under part 9A of the Financial Services and Markets Act 2000 (FSMA), notably on the definition of Senior Management Functions (SMFs) and the allocation of responsibilities to Senior Managers.

In addition, PS20/15 included a set of near-final rules covering the extension of the new regimes to non-EEA branches that could not be made until Parliament approved HM Treasury’s order extending the definition of ‘relevant authorised persons’ in section 71A of FSMA to incoming branches (section 71A order).  In particular these rules covered the certification regime and grandfathering arrangements for non-EEA branches. While the rules could not be published in final form at the time, the PRA considered it important to give firms as much certainty at an early stage to prepare for implementation.

HM Treasury laid the section 71A order before Parliament on 22 July 2015 and it came into force on 9 November 2015. Consequently, the PRA is now able to formally finalise the near-final rules it published in August. As indicated in PS20/15, the final rules included in this policy statement are identical to the near-final rules published in August. In addition, we have made a number of small corrective changes to our rules.

This policy statement also includes the final version of Supervisory Statement 28/15 Strengthening individual accountability in banking, which includes a number of additional paragraphs setting out the PRA’s expectations of how non-EEA branches should comply with certain aspects of the new regimes. These paragraphs cover the scope and prescribed responsibilities for incoming third-country branches, and were included as an appendix to PS20/15. As stated in PS20/15, all other aspects of SS28/15 will apply to non-EEA branches in the same way that they apply to UK firms. 

Policy Statement

Strengthening individual accountability in banking: UK branches of non-EEA banks – PS29/15

Appendices

  1. PRA Rulebook: CRR Firms Non-CRR Firms: Individual Accountability Instrument (No. 4) 2015
  2. Strengthening individual accountability in banking – SS28/15 UPDATE
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