Strengthening individual accountability in banking and insurance - responses to CP14/14 and CP26/14

Policy Statement 3/15
Published on 23 March 2015

Overview

This policy statement provides feedback on responses to the proposals in CP14/14 Strengthening accountability in banking: a new regulatory framework for individuals, and CP26/14 Senior insurance managers regime: a new regulatory framework for individuals,  and issues the first set of the final PRA rules to implement the Senior Managers Regime (SMR) and Certification Regime for UK banks, building societies, credit unions and PRA-designated investment firms (known as ‘relevant authorised persons’), and the Senior Insurance Managers Regime (SIMR) for Solvency II insurers.

SMR

The rules issued in Appendix 1 cover the:

  • scope of the PRA’s SMR;
  • allocation of Prescribed Responsibilities to Senior Managers;
  • scope of the PRA’s Certification Regime; and
  • assessment of fitness and propriety of Senior Managers and certified employees.

These rules will come into force on 7 March 2016.

SIMR

The rules issued in Appendices 2 and 3 cover the:

  • scope of the Senior Insurance Managers Regime (SIMR);
  • allocation of Prescribed Responsibilities; and
  • assessment of fitness and propriety of individuals by firms.

The Instrument at Appendix 2 contains the rules in respect of the fitness and propriety of individuals that transpose, or are closely related to the implementation of Solvency II. These rules will come into force on 1 January 2016, and will be replaced by the rules at Appendix 3 for implementation on 7 March 2016.

The Instrument at Appendix 3 contains the first set of final rules for the SIMR, which deal with the changes to the FSMA regime being made by the Banking Reform Act 2013, and introduce changes designed to align the SIMR with the SMR for banks. These rules will commence with effect from 7 March 2016, replacing the rules in Appendix 2.

Further aspects of the SMR and SIMR

This policy statement does not provide feedback on all the elements of CP14/14 and CP26/14, or all the final rules needed to implement the new regimes. There are some elements of the PRA’s new regimes that need to be finalised in conjunction with the Financial Conduct Authority (FCA). There are also other aspects of the regimes which have been consulted on subsequent to CP14/14 and CP26/14. The PRA will issue a further policy statement and further final rules and supervisory statements on the outstanding elements of the regimes later in the year. The PRA’s ‘Strengthening accountability’ webpage summarises development to date and what’s coming up on policy and implementation of the new regimes – see Related Links.

CP14/14 was published jointly with the Financial Conduct Authority (FCA). Readers may also find it useful to refer to the FCA’s feedback, which is contained in CP15/9: Strengthening accountability in banking: a new regulatory framework for individuals, 16 March 2015.

PDFPolicy Statement 3/15

PDFPress release

 

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