New firm authorisation

New firms wishing to become a bank, credit union, insurer or managing agent of a Lloyd’s syndicate need to apply to the Prudential Regulation Authority (PRA) for permission first.

This information applies for new firms seeking authorisation to carry on regulated activities as a:

  • credit union
  • insurer (both general and life)
  • managing agent of a Lloyd’s syndicate.

Firms wishing to set up a new bank should refer to our New Bank Start-up Unit.

Firms wishing to set up an insurance special purpose vehicle (ISPV) should refer to the Insurance special purpose vehicles page.

Firms seeking authorisation to carry out any other activities should apply to the Financial Conduct Authority (FCA). 

A list of all regulated activities is available in the Financial Services and Markets Act 2000 (PRA-regulated Activities) Order 2013

The pre-application stage

We find that meeting with prospective firms before they submit an application helps them to:

  • understand the authorisation process and what happens at the various stages
  • understand our expectations of firms, and in particular the PRA and FCA Threshold Conditions 
  • identify any particular concerns that the regulators might have early on, and help firms make an informed decision about whether to spend time and money on an application that may not progress further
  • submit as complete an application as possible.

However, there is no statutory requirement to meet us before submitting an application. An application can be sent at any time, and we will use our statutory powers as set out in the Financial Services and Markets Act (FSMA) to reach a decision.

We generally meet three times with firms:

  1. Initial meeting: This takes place after a firm submits its draft business plan. It provides an opportunity for firms to discuss their plan and ask the regulators (the PRA and the FCA) questions about the authorisation process. The regulators will provide written feedback for the firm to respond to in its business plan.
  2. Feedback meeting: This takes place after a firm has submitted – and we have reviewed – its updated business plan. We will again provide feedback, which the firm will be expected to address in its business plan.
  3. Challenge session: This takes place just before a firm submits its application, with the aim of discussing its proposals in depth and with the regulators providing detailed challenge on the content of the firm’s near-final business plan. Firms will be expected to incorporate feedback from this session into their application.

Meetings are attended by both the PRA and the FCA and will typically be held at either the PRA’s or the FCA’s offices in London. Exceptions will primarily be made for internationally headquartered firms. 

To initiate a pre-application meeting, we would expect as a minimum an explanation of why a firm wants to be an authorised entity and the initial business proposition and strategy including the:

  • business plan – what products will be offered, how they will be offered and the target market
  • sources of funding – how the business proposes to fund its activities, and whether there are any investors and/or funding in place
  • corporate governance – details of structure, board, senior management and governance arrangements, as far as they are known.

We may ask for further information, such as information on the proposed controllers if relevant.

To request a pre-application meeting, email PRA-AuthsVoPsCancellations@bankofengland.co.uk

Pre-application: Lloyd’s managing agents

Firms applying as Lloyd's managing agents should have had detailed discussions with Lloyd’s before they submit an application to us. A pre-application meeting will depend on the specifics of the application, but if necessary it will involve Lloyd’s and the firm.

Pre-application: credit unions

We have specific requirements for credit union applicants’ business plans, which are set out in Credit union authorisation: supporting documents.

Submitting an authorisation application 

To submit an application, firms will need to send two hard copies (one for the PRA and one for the FCA) and two electronic copies (on a memory stick, DVD etc) of all their documents to us at: PRA Authorisations, Authorisations Division, Prudential Regulation Authority, 20 Moorgate, London EC2R 6DA.

You will also need to include a cheque for the fee as set out in FEES 4. The cheque should be sent to the PRA but paid payable to the Financial Conduct Authority as the scheme administrator.

The PRA and FCA will make a decision on all applications within six months of receiving a complete application, or twelve months of receiving an incomplete application. 

For an application to be considered as complete, it will need to include all of the required application forms, which have been fully and correctly completed. The information provided must be of sufficient quality and detail to allow us to complete our assessment. We also expect firms to have incorporated responses to the feedback provided during the pre-application stage.

Banks: application forms and guidance

Application form for banks Download document
Application form for bank - notes Download document
IT Self Assessment Questionnaire Download document
Detailed IT Controls form Download document

BT and ELS form for proposed business

(Find under 'Forms, definitions and validations' tab)

Open link
Disclosure of significant events appendix Download document
Corporate controllers form Download document
Partnership controllers form Download document
Individual controllers form Download document
 Waivers and modifications applications  Download document
           

Insurers: application forms and guidance

Insurers core details application form  Download document
Insurers core details application form: notes  Download document
Supplement for insurance firms  Download document
Supplement for insurance firms: notes  Download document
Owners and influencers appendix  Download document
Owners and influencers appendix: notes  Download document
Insurers checklist and declaration  Download document
IT self-assessment questionnaire: insurers  Download document
Detailed IT controls form: insurers  Download document

The PRA's new regime for insurance special purpose vehicles (ISPVs) following CP42/16 'Authorisation and supervision of insurance special purpose vehicles' will come into effect when the final policy is published in due course. This will include updated application forms and corresponding notes.

Lloyd's managing agents: application forms and guidance

Supplement for Lloyd's managing agents WordDownload document 
Supplement for Lloyd's managing agents WordDownload document

 

Credit unions: application forms and guidance

Credit union application form  Download document
Credit union application form: notes  Download document
Credit union registration appendix  Download document
Credit union registration appendix: notes  Download document
Single Customer View requirements exemption notification appendix  Download document
Single Customer View requirements exemption notification appendix: notes  Download document
IT self-assessment questionnaire: credit unions  Download document
Detailed IT controls form: credit unions  Download document
Application for approval of use of words 'credit union' in name  Download document
Disclosure of significant events appendix  Download document

 

How we assess and determine applications

Part 4A of the Financial Services and Markets Act 2000 (FSMA) sets out the requirements of new firm authorisations and the Threshold Conditions that firms must meet at authorisation and on an ongoing basis.

Our supervisory approach documents set out the PRA policy on the matters that we consider when we decide whether to authorise a firm.

Authorisation will not be granted unless both the PRA and the FCA are satisfied that it should be. If an application is unsuccessful, we will inform the firm about its options for challenging the decision.

We may vary or cancel a firm’s permission if it does not start a regulated activity for which it has permission within 12 months of permission being given. 

PRA Direction notices

PRA Direction notice, 16 December 2015 PDFDownload PDF
PRA Direction notice, 18 September 2015 PDFDownload PDF

 

EEA bank and insurer branches

Following on from the 20 December 2017 letter ‘Firms’ preparations for the UK’s withdrawal from the European Union: planning assumptions’, this section provides additional information on the authorisation process for EEA banks and insurers operating on a passport that wish to apply for authorisation as a third-country branch in the United Kingdom. This section supplements the information above, which outlines the authorisations process in general. The dedicated New Bank Start-up Unit offers additional guidance for banking applications, though this is targeted at firms which have not previously operated in the United Kingdom and may include information less relevant to branch applications (such as mobilisation).  

Pre-Application

As described above, firms are actively encouraged to engage with the PRA prior to the submission of an application, through the pre-application process. Firms are not required to engage in the pre-application process and can apply at any time, but there are benefits to meetings ahead of submission.

If you have not already done so, EEA branches wanting to seek authorisation in the United Kingdom should contact their usual supervisory contact to arrange a pre-application meeting. If you do not have a named supervisor, please contact the PRA’s Firm Enquiries Function (at PRA.FirmEnquiries@bankofengland.co.uk or 020 3461 7000), who will liaise with the relevant supervisory teams. 

The number of pre-application meetings and the form of these meetings is not fixed. For most EEA branches, the PRA expects to have only one meeting, but for large firms with a complex business proposition, the PRA may wish to have multiple meetings in order to discuss specific areas in more detail. 

Application

As for all firms, the statutory timeframe for a branch application is six months for a complete application and up to twelve months for an incomplete application. The basis for the assessment of any application is determining whether the applicant meets the PRA’s and the FCA’s Threshold Conditions. The PRA’s approach to the assessment of branches also applies to the whole firm and not just the branch itself.  In order to demonstrate that the firm is meeting the Threshold Conditions for authorisation, the PRA relies on a relationship with the firm’s Home State Supervisor. On 20 December 2017, the PRA published proposals for a new branching policy for insurers and a revised branching policy for banks. consultation papers setting out the PRA’s approach to the supervision and authorisation of international banks and insurers .

The relevant application forms set out the material required from a firm. However, the forms are not specific to branches and there may be some material that is relevant for subsidiaries only. If a firm is unsure of the criteria for application, the PRA will discuss this with the firm during the pre-application stage.  

 
This page was last updated 16 January 2018
Was this page useful?
Add your details...