United Kingdom (and EU regulation)

PRA Consultation Paper 5/14: Occasional Consultation Paper

The PRA has published its latest Occasional Consultation Paper (Consultation Paper 5/14) which sets out proposals that:

clarify certain issues which have been identified in the technical amendments to the rules for financial conglomerates introduced in Policy Statement 3/13;
amend the PRA supervisory statement on the Internal Capital Adequacy Assessment Process and the Supervisory Review and Evaluation Process. It brings to the attention of supervised firms the December 2013 European Banking Authority guidelines on capital requirements for foreign exchange retail and small and medium sized enterprise lending and sets out the PRA’s approach to compliance;
amend BIPRU 12.7 to allow Shari’ah-compliant firms to include a wider set of assets in their liquid assets buffers. These proposals are intended to help reduce the risks of concentration in Shari’ah-compliant firms’ liquidity buffers and they are intended to help remove potential barriers to growth and entry; and
amend BIPRU 12 to introduce requirements and guidance for the risk management of asset encumbrance. These proposed changes are relevant to banks, building societies and designated investment firms subject to BIPRU 12.

The deadline for comments on the Consultation Paper is 15 April 2014.