CP3/22 – Occasional Consultation Paper – March 2022

PRA Consultation Paper 3/22
Published on 15 March 2022

Overview

This Consultation Paper (CP) sets out the Prudential Regulation Authority’s (PRA) proposals to make minor amendments to UK Technical Standards (UKTS), PRA rules, supervisory statements (SS), Legacy Supervisory Statements (LSS), and a Statement of Policy (SoP). 

The chapters in this CP are relevant to different types of firms, as follows:

  • Chapter 2 – all UK Solvency II firms, including the Society of Lloyd’s and its managing agents, hereafter referred to as ‘UK insurers’.
  • Chapter 3 – Capital Requirements Regulation (CRR) firms and CRR consolidation entities on an individual, consolidated, and where relevant, sub-consolidated basis (CRR Consolidation Entities). For the purposes of the application of the requirements on a consolidated basis, references to ‘firms’ include CRR consolidation entities.
  • Chapter 4 (a) – banks, building societies, and PRA-designated investment firms.
  • Chapter 4 (b) – Capital Requirements Regulation (CRR) firms and CRR Consolidation Entities. For the purposes of the application of the requirements on a consolidated basis, references to ‘firms’ include CRR consolidation entities. 
  • Chapter 4 (c) – banks, building societies, and PRA-designated investment firms.
  • Chapter 5 – Capital Requirements Regulation (CRR) firms, CRR Consolidation Entities, and UK insurers.
  • Chapter 6 – banks, building societies, and PRA-designated investment firms.
  • Chapter 7 – banks, building societies, and PRA-designated investment firms.
  • Chapter 8 - Capital Requirements Regulation (CRR) firms and CRR Consolidation Entities. For the purposes of the application of the requirements on a consolidated basis, references to ‘firms’ include CRR consolidation entities.
The chapters contained in this CP, the policy material they propose to change, and the appendices containing the draft amended policy, are listed in the table below.

Chapter

Policy Material

Appendix

2. The PRA’s approach to Solvency II technical information – minor updates

Statement of Policy ‘The PRA’s approach to the publication of Solvency II technical information’

1

3. Leverage Ratio: Minor amendment to SS45/15

SS45/15 ‘The UK leverage ratio framework’

2

4. Amendments consequential on CRR Rules

Draft PRA Rulebook: (CRR 2 and other Consequentials) Modification Instrument 2022

Draft PRA Standards Instrument: the Technical Standards (Consequential Amendments) Instrument 2022

3

5. Deletion of non-relevant policy material

SS3/13 ‘Capital and leverage ratios for major UK banks and building societies’

4

SS4/13 ‘Solvency II: applying EIOPA's preparatory guidelines to PRA-authorised firms’

5

SS29/15 ‘CRD IV: Interim LCR reporting’

6

Legacy SS4/13 ‘Liquidity and capital regime for UK banks and building societies: adjustments in relation to FPC statement’

7

Legacy SS6/13 ‘Pension obligation risk: treatment in the Internal Capital Adequacy Assessment Process (ICAAP) for banks and building societies’

8

Statement of Policy ‘Interpretation of EU Guidelines and Recommendations: Bank of England and PRA approach after the UK’s withdrawal from the EU’

9

6. Consequential amendments to the PRA Rulebook and UK Technical Standards (UKTS) arising from the introduction of the Investment Firms Prudential Regime (IFPR)

Investment Firms Prudential Regime Amendment Instrument 2022

10

Draft PRA Standards Instrument: The technical standards (Investment Firms’ Prudential Regime Consequential Amendments)

11

7. Amendments to Pillar 3 Liquidity disclosure template and instructions

Template UK LIQ2: Net Stable Funding Ratio

12

Instructions on Template UK LIQ2 on disclosure of Net Stable Funding Ratio (NSFR)

13

8. CRR Rule Administration Instrument

Standardised Approach and Internal Ratings Based Approach to Credit Risk (CRR) Part of the PRA Rulebook; and Counterparty Credit Risk (CRR) Part of the PRA Rulebook; and Leverage Ratio (CRR) Part of the PRA Rulebook

14

Implementation

Pending consideration of the responses to this consultation, the proposed implementation date for the changes resulting from this CP is Thursday 28 July 2022.

Responses and next steps

This consultation closes on Tuesday 10 May 2022. The PRA invites responses on the proposals set out in this consultation. Please address any comments or enquiries to OCP.Responses@bankofengland.co.uk. Please indicate in your response if you believe any of the proposals in this consultation paper are likely to impact persons who share protected characteristics under the Equality Act 2010, and if so, please explain which groups and what the impact on such groups might be.

Consultation Paper 3/22

Consultation end date: 10 May 2022

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