News release
The Prudential Regulation Authority (PRA) has fined The Bank of London Group Limited and Oplyse Holdings Limited (formerly The Bank of London Group Holdings Limited) £2 million for misleading the PRA over their capital positions, failing to act with integrity, failing to be open and cooperative with the regulator and failing to maintain adequate financial resources.
The PRA has fined The Bank of London Group Limited and its parent financial holding company Oplyse Holdings Limited (formerly The Bank of London Group Holdings Limited) £2 million for misleading the PRA over their capital positions, failing to act with integrity, failing to be open and cooperative with the regulator, and failing to maintain adequate financial resources. This is the first time the PRA has fined a firm for failing to conduct its business with integrity, and the first time the PRA has taken enforcement action against a parent financial holding company of a firm. The failings occurred between October 2021 and May 2024.
The PRA, the Bank of London Group Limited and Oplyse Holdings Limited have agreed to settle this matter. The breaches in this case warranted a financial penalty of £12 million. However, the Bank of London Group Limited and Oplyse Holdings Limited have demonstrated that payment of such a penalty would cause serious financial hardship and the PRA has therefore reduced the penalty to £2m.
The PRA’s investigation found that between 7 October 2021 and 22 May 2024 the Bank of London Group Limited and Oplyse Holdings Limited:
- failed to comply with their regulatory capital requirements over an extended period;
- repeatedly misled the PRA as to their actual capital positions. Most seriously, this included providing the PRA with several fabricated documents intended to provide a false picture of the capital position;
- failed to be open and transparent with the regulator on numerous further occasions, including in relation to their deteriorating solvency position; and
- failed to act in a prudent manner, including failing to manage or report a large exposure resulting from a loan from the Bank of London Group Limited to Oplyse Holdings Limited.
Sam Woods, Deputy Governor for Prudential Regulation and Chief Executive Officer of the PRA, said: “Trust in banking in the UK requires integrity and open communication with the PRA from all banks, regardless of their size. The Bank of London Group Limited and Oplyse Holdings Limited fell well below our standards, resulting in today’s penalty which marks the PRA’s first finding against a firm for acting without integrity.”
Rule breaches
The PRA found that The Bank of London Group Limited breached:
- Fundamental Rule 1 (a firm must conduct its business with integrity);
- Fundamental Rule 3 (a firm must act in a prudent manner);
- Fundamental Rule 4 (a firm must at all times maintain adequate financial resources);
- Fundamental Rule 7 (a firm must deal with its regulators in an open and cooperative way and must disclose to the PRA appropriately anything relating to the firm of which the PRA would reasonably expect notice);
- Chapter 3, Article 5 (requirement to report own funds on an individual basis), Reporting (CRR) Part of the PRA Rulebook;
- Article 393 Capacity to Identify and Manage Large Exposures, the Large Exposures (CRR) Part of the PRA Rulebook;
- Article 394 Reporting Requirements, the Large Exposures (CRR) Part of the PRA Rulebook;
- Article 395 Limits to Large Exposures, the Large Exposures (CRR) Part of the PRA Rulebook;
- Rule 2.3 of the Notifications Part of the PRA Rulebook;
- Rule 2.1 of the Related Party Transaction Risk Part of the PRA Rulebook; and
- Rule 2.3 of the Related Party Transaction Risk Part of the PRA Rulebook.
The PRA found that the The Bank of London Group Limited and Oplyse Holdings Limited breached:
- Rule 7A of the Definition of Capital Part of the PRA Rulebook.
The PRA found that the Oplyse Holdings Limited breached:
- Chapter 3, Article 7 (requirement for reporting own funds on a consolidated basis), Reporting (CRR) Part of the PRA Rulebook.