PRA Regulatory Digest - March 2022

The PRA Regulatory Digest is for people working in the UK financial services industry and highlights key regulatory news and publications delivered for the month.
Published on 01 April 2022

Top news and publications

  • PS3/22 – Financial Services Compensation Scheme – Management Expenses Levy Limit 2022/23
  • Letter from Sam Woods ‘Existing or planned exposure to cryptoassets’

News and speeches

The PRA’s supervisory priorities for the insurance sector in 2022 – speech by Charlotte Gerken

2 March 2022

At Norton Rose Fulbright LLP, Charlotte set out the PRA’s supervisory priorities for insurance firms in the coming year.

The PRA’s supervisory priorities for the insurance sector in 2022 – speech by Charlotte Gerken

Cross cutting publications and updates

PS7/21 – Outsourcing and third party risk management

31 March 2022

As a reminder, firms are expected to comply with the expectations contained in Supervisory Statement (SS) 2/21 ‘Outsourcing and Third Party Risk Management’. Firms are also reminded that they should seek to review and update legacy outsourcing agreements entered into before Wednesday 31 March 2021 at the first appropriate contractual renewal or revision point to meet the expectations in the SS as soon as possible.

PS7/21 – Outsourcing and third party risk management

PS3/22 – Financial Services Compensation Scheme – Management Expenses Levy Limit 2022/23

25 March 2022

This Policy Statement (PS) provides feedback to responses to Consultation Paper (CP)1/22 ‘Financial Services Compensation Scheme - Management Expenses Levy Limit 2022/23’. It also contains the final rules for the Financial Services Compensation Scheme Management Expenses Levy Limit for 2022/23.

This PS is relevant to all PRA-authorised firms, but contains no material of direct relevance to retail financial services consumers or consumer groups upon which they might need to act.

PS3/22 – Financial Services Compensation Scheme – Management Expenses Levy Limit 2022/23

CP3/22 – Occasional Consultation Paper – March 2022

15 March 2022

This CP sets out the PRA’s proposals to make minor amendments to UK Technical Standards, PRA rules, supervisory statements, Legacy SSs, and a Statement of Policy. 

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) – 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 – 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 - 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 on the webpage.

This consultation closes on Tuesday 10 May 2022. Please address any comments or enquiries to OCP.Responses@bankofengland.co.uk

CP3/22 – Occasional Consultation Paper – March 2022

PS2/22 – Operational Resilience and Operational Continuity in Resolution: CRR firms, Solvency II firms, and Financial Holding Companies (for Operational Resilience)

11 March 2022

This PS provides feedback to responses to CP21/21 ‘Operational Resilience and Operational Continuity in Resolution: CRR firms, Solvency II firms, and Financial Holding Companies (for Operational Resilience)’.

This PS is relevant to different types of firms as follows:

Operational Resilience:

  • UK banks, building societies, and PRA-designated investment firms and CRR consolidation entities; and
  • UK Solvency II firms, and the Society of Lloyd’s and its managing agents.

Operational Continuity in Resolution: UK banks, building societies, and PRA-designated UK investment firms currently in scope of, or likely to come in scope of, the Operational Continuity Part of the PRA Rulebook.

The implementation dates for the changes set out in this PS are:

  • Thursday 31 March 2022 for the Operational Resilience Parts and the Group Supervision Part; and
  • Sunday 1 January 2023 for the Operational Continuity Part.

To remind firms, the final Operational Resilience Rules come into force on 31 March 2022. By this time firms in scope of the rules must have identified their important business services and set impact tolerances. Firms now have until no later than 31 March 2025 to ensure they can remain within those impact tolerances.

PS2/22 – Operational Resilience and Operational Continuity in Resolution: CRR firms, Solvency II firms, and Financial Holding Companies (for Operational Resilience)

Banking publications and updates

DP1/22 – The prudential liquidity framework: Supporting liquid asset usability

31 March 2022

This Bank and PRA DP considers the usability of banks’ stocks of High Quality Liquid Assets (HQLA), and seeks views from banks, wider market participants, and other interested parties to continue to improve understanding of:

  • to what extent banks feel constrained in their ability to draw on their stock of HQLA to meet unusual liquidity demands;
  • what factors affect this; and
  • to what extent it is desirable that banks feel more able to draw on their HQLA, and how this could be achieved.

This DP is relevant to banks, wider market participants, and other interested parties who wish to provide feedback on the topics discussed in this DP, including by providing answers to the questions posed in this paper.

The Bank and PRA would welcome views on this discussion paper, including answers to the questions. Please submit responses toDP1_22@bankofengland.co.uk, by Thursday 30 June 2022.

DP1/22 – The prudential liquidity framework: Supporting liquid asset usability

Letter from Sam Woods ‘Existing or planned exposure to cryptoassets’

24 March 2022

Sam Woods sent a letter to Chief Executive Officers of banks and designated investment firms on the treatment of cryptoassets under the current frameworks.

Letter from Sam Woods ‘Existing or planned exposure to cryptoassets’

More information

Bank Underground – a blog for Bank of England staff to share views that challenge – or support – prevailing policy orthodoxies. The views expressed here are those of the authors, and are not necessarily those of the Bank of England or its policy committees.

Bank Overground – the purpose of Bank Overground is to share our internal analysis. Each bite-size post summarises a pieces of analysis that support a policy or operational decision.

KnowledgeBank – from Interest rates and inflation through to bank failures and financial crises, KnowledgeBank uses everyday examples and engaging visuals to bring economics to life.

European and International developments – readers are referred to the following websites:

Give your feedback

Was this page useful?
Yes
No
Add your details...