Ensuring operational continuity in resolution: reporting requirements

Policy Statement 10/17 | Consultation Paper 28/16

Published on 28 April 2017

Ensuring operational continuity in resolution: reporting requirements – PS10/17

Overview

This Prudential Regulation Authority (PRA) policy statement (PS) provides feedback to responses to Consultation Paper (CP) 28/16, ‘Ensuring operational continuity in resolution: reporting requirements’ (‘the CP’). The CP set out proposals for the data the PRA intends to collect in connection with the financial resilience policy set out within Supervisory Statement (SS) 9/16 ‘Ensuring operational continuity in resolution’ and the General Organisational Requirements and Outsourcing Parts of the PRA Rulebook.

This PS is relevant to UK banks, building societies and PRA-authorised investment firms to which the Operational Continuity Part of the PRA Rulebook applies (‘operational continuity firms’) that receive critical services from one or more members of their group or from a business unit within the firm itself (‘group providers’).

This PS contains the final amendments to the Regulatory Reporting Part  (Appendix 1), final amendments to SS34/15 ‘Guidelines for completing regulatory reports’  (Appendix 2), and the final template PRA109 (consulted on as PRA117) and reporting instructions (Appendix 3), which implement the proposals consulted on in the CP.

Feedback on consultation responses

The PRA has made several amendments to the draft rules and documents consulted on in the CP in light of feedback received and further analysis, mainly to add further clarity, remove redundant items and improve the quality of reporting information. The changes in response to feedback to the consultation are set out in Chapter 2, and additional changes resulting from further analysis by the PRA are included in Chapter 3.

Next steps

The amendments to the Regulatory Reporting Part and updates to SS34/15 set out in this PS will take effect from 1 January 2019. Operational continuity firms are required to submit the template, (PRA109), 45 business days after the first reporting period ending 31 December 2019.

In the CP, the PRA proposed to collect the data in the reporting templates by electronic means, as for other regulatory reporting. The PRA is aware that firms will need information on the precise mechanism by which that data will be collected to assist with implementation. The PRA will aim to provide firms with an update on this in 2018 Q4.

This policy has been designed in the context of the current UK and EU regulatory framework. The PRA will keep the policy under review to assess whether any changes would be required due to changes in the UK regulatory framework, including those arising once any new arrangements with the European Union take effect. 

Appendices

PDFOperational Continuity Reporting Instrument

Supervisory Statement 34/15 UPDATE

PRA109 Operational continuity templates and instructions, available on the CRD firms – Reporting requirements webpage.


Published on 29 July 2016

Ensuring operational continuity in resolution: reporting requirements – CP28/16

Background

In this consultation paper (CP) the Prudential Regulation Authority (PRA) sets out proposals for data that the PRA intends to collect in connection with the final policy on operational continuity set out within Supervisory Statement (SS) 9/16 ‘Ensuring operational continuity in resolution’ and the General Organisational Requirements and Outsourcing Parts of the PRA Rulebook.

This CP is relevant to UK banks, building societies and UK designated investment firms (hereinafter ‘firms’) that provide functions that are critical to the economy and that need to be continued in resolution. The proposals are intended to apply to those firms in scope of the application thresholds set out in 1.1 of The Operational Continuity Part of the PRA Rulebook.

Summary of proposals

This consultation sets out proposals for firms to report on the activities and financial resources of their group provider(s). This will enable the PRA to monitor its expectations for the adequacy of a group provider’s liquid assets. SS9/16 sets out that a firm should ensure that, as a minimum, a group provider should be supported by liquidity resources equivalent to at least 50% of annual fixed overheads of the critical services provided by the group provider.

The PRA proposes that firms in scope will be required to submit the information annually, on a calendar year basis. Such firms must submit the information 45 business days after the first reporting period ending 31 December 2019, with the first submission due in March 2020.

Implementation

The reporting policy contained in this CP has been designed in the context of the current UK and EU regulatory framework. The PRA will keep the policy under review to assess whether any changes may be required due to changes in the UK regulatory framework, including those arising once any new arrangements with the European Union take effect. The PRA intends any eventual rules and reporting to apply from 1 January 2019.

Responses

This consultation closed on Friday 28 October 2016.

PDFConsultation Paper 28/16

Proposed amendments to the PRA Regulatory Reporting Part of the PRA Rulebook, amendments to SS34/15 ‘Guidelines for completing regulatory reports’ a draft reporting instructions and a template are set out in the appendices to this CP.

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