The Financial Policy Committee (FPC) and the PRA have jointly published a paper that contains two consultations.
The first consultation sets out the FPC’s proposed recommendation to the PRA to exclude claims on central banks from the leverage exposure measure in the UK leverage ratio framework; and compensate for the resulting reduction in capital needed to meet the leverage ratio minimum requirement and leverage ratio buffers by increasing the minimum requirement from 3% to 3.25%.
The second consultation sets out the PRA’s proposals for implementing the FPC’s proposed recommendation.
Both consultations are relevant to PRA-regulated banks and building societies with retail deposits equal to or greater than £50 billion on an individual or a consolidated basis.
The deadline for comments on the consultation paper is 12 September 2017.