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 who are EEA banks or insurers, and who are seeking authorisation from the PRA as a third country branch, should refer to this section. This also includes a section on the pre-application process.

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.

For firms who are new to the regulatory environment (such as start-up firms), we generally aim to 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.

Firms who have an existing relationship with the PRA may not require as many meetings, and for small, less complex and established businesses we often find that one meeting achieves the aims as set out above.

Meetings are generally 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, but not limited to, 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, a firm that has an existing relationship with the PRA should contact their relevant supervisory contact. For those new to the regulatory environment, please 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 follow the following steps:

For applications where the total file size amounts to 25 MB and below:

For applications where the total file size amounts to 25 MB and above:

  • Please contact the PRA Authorisations Department using the following mailbox: PRA-AuthsVoPsCancellations@bankofengland.co.uk to request login details to be able to access and submit the documents via the Bank of England Data Submission (BEEDS) portal. Users will need to provide the following information:
  • Firm name and firm reference number (FRN) (6 digits)
  • Forename
  • Surname
  • Email address
  • Telephone number (used to receive a session security code as part of the log in process, users find a mobile number easier)

Further information and guidance can be found in the BEEDS Portal User Guide & BEEDS Quick Reference Guide:

PDFBEEDS Portal User Guide

PDFBEEDS Quick Reference Guide

Fee

The preferred method for payment of fees is via BACS, however cheques are also accepted. Please refer to FEES 4 in the FCA Handbook for more information.

BACS method

Please make the payment to the FCA using the details below:

Account name: FCA Collection account
Bank name: Lloyds Bank
Account number: 00828179
Sort code: 30-00-02
Swift code: LOYD GB 2LCTY
Iban code: GB68 LOYD 3000 0200 8281 79.

When you make the payment, please reference it with the following: Title: 'New authorisation application' and the 'firm name' (Name of the firm applying for authorisation).

Please then email your remittance advice and payment details to: fcafees@fca.org.uk &PRA-AuthVoPsCancellations@bankofengland.co.uk.

Cheque method

The cheque should be sent to the PRA at the following address: Prudential Regulation Authority, Authorisations, 20 Moorgate, London, EC2R 6DA but should be made payable to the Financial Conduct Authority as the scheme administrator (please note the FCA cannot accept post-dated cheques) and write the name of the ‘Applicant firm’ and title ‘Application for authorisation’ on the reverse of the cheque. The Cheque should also be accompanied by a covering letter. 

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)

Data collection forms
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

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).

You may also find it helpful to refer to PRA Policy Statement (PS) 3/18 ‘International banks: the Prudential Regulation Authority’s approach to branch authorisation and supervision’, PS4/18 ‘International insurers: the Prudential Regulation Authority’s approach to branch authorisation and supervision’ published in March 2018, and the letter ‘Firms’ preparations for the UK’s withdrawal from the European Union: planning assumptions' issued in December 2017.

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. At the first meeting, the PRA will expect to understand topics such as the business undertaken in the United Kingdom, the parental/group relationships and a discussion on the practical aspects of the application including what needs to be submitted and the process for doing so.

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.

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 06 April 2018
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