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Home > Prudential Regulation Authority > The minimum requirement for own funds and eligible liabilities (MREL) – buffers and Threshold Conditions – SS16/16
 

The minimum requirement for own funds and eligible liabilities (MREL) – buffers and Threshold Conditions – SS16/16

08 November 2016

Overview

This supervisory statement (SS) is aimed at Prudential Regulation Authority (PRA)-regulated banks, building societies and PRA designated investment firms (firms).

This statement sets out the PRA’s expectations on the relationship between the minimum requirement for own funds and eligible liabilities (MREL) and both capital and leverage ratio buffers, as well as the implications that a breach of MREL would have for the PRA’s consideration of whether a firm is failing, or likely to fail, to satisfy the Threshold Conditions.

This SS provides further detail in relation to the high level expectations outlined in ‘The PRA’s approach to banking supervision’. As set out in the approach document, firms are expected to engage directly with policy material, including SSs, and determine — bearing in mind the overarching principle of safety and soundness — whether they meet the PRA’s expectations.

This SS should be read in conjunction with the Bank of England’s (the Bank’s) statement of policy on its approach to setting MREL, PRA SS6/14 on capital buffers, and PRA SS31/15 on leverage buffers.

Supervisory statement

The minimum requirement for own funds and eligible liabilities (MREL) – buffers and Threshold Conditions – SS16/16

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