Capital Requirements Directive

The Capital Requirements Directive covers prudential rules for banks, building societies and investment firms.

This page explains our implementation of these rules and also provides updates on our prudential policies for banks, building societies and designated investment firms.

Background

In May 2019, the European Union (EU) published legislation to implement, within the EU, some of the remaining Basel III prudential reforms agreed by the Basel Committee on Banking Supervision (BCBS). This legislation, known as CRD V (Directive (EU) 2019/878) and Capital Requirements Regulation (CRR) II (Regulation (EU) 2019/876), amended CRD IV (Directive (EU) 2013/36) and CRR (Regulation (EU) 575/2013) respectively.

We implemented elements of CRD V and the final policy was published in PS29/20 ‘Capital Requirements Directive V (CRD V)'.

We are consulting in CP5/21 ‘Implementation of Basel standards’ on its proposed rules through a new PRA Capital Requirements Regulation (CRR) rule instrument. The purpose of these rules is to implement part of the set of international standards that remain to be implemented in the UK. The consultation closes on Monday 3 May 2021.

Latest CRD updates

4 March 2021: As described in PS26/20 (Capital Requirements Directive V (CRD V)), the PRA has exercised its own initiative powers under s55M(3) and s55Y(4) FSMA to implement the changes to (i) the Capital Buffers and Pillar 2A Model Requirement and (ii) the Additional Leverage Ratio Buffer Model Requirements, as well as, for those firms subject to it, to replace references to the Systemic Risk Buffer with references to the O-SII Buffer. All firms have received Own Initiative Requirement notices from December 2020 to that effect. The text of the current Capital Buffers and Pillar 2A Model Voluntary Requirement (VREQ) and Additional Leverage Ratio Buffer Model Requirements is available on the Bank of England website.

25 February 2021: We published ‘PRA statement on the definition of ‘higher paid material risk taker’, which addresses an error identified by the PRA in the Remuneration Part of the PRA Rulebook.   

12 February 2021: We published CP5/21 ‘Implementation of Basel standards’. This CP is relevant to banks, building societies, PRA-designated investment firms, and PRA-approved or -designated financial or mixed financial holding companies (firms). This consultation closes on Monday 3 May 2021.

11 January 2021: We published CP2/21 ‘International banks: The PRA’s approach to branch and subsidiary supervision’. This CP is relevant to existing or prospective PRA-authorised banks and designated investment firms that are headquartered outside of the UK or are part of a group based outside of the UK. This consultation closes on Sunday 11 April 2021.

CRD news and publications

Please see The National Archives for historical CRD information.

This page was last updated 17 March 2021

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