On 19 June 2023, the Prudential Regulation Authority (PRA) published Consultation Paper 14/23 (CP14/23), setting out its proposals to enhance Pillar 3 remuneration disclosure requirements by reducing the number of such disclosures that are required for many smaller banks and building societies.

The consultation follows on from the PRA’s February 2023 consultations CP4/23 (on liquidity and disclosure requirements for simpler-regime firms under the Strong and Simple Framework) and CP5/23 (on remuneration: enhancing proportionality for small firms). In CP4/23 and CP5/23, the PRA stated that it would consider the interaction of the disclosure and remuneration proposals and intended to consult on the new remuneration disclosure requirements in the near future. Both of these are set out in CP14/23, with the aim of delivering a complete disclosure package for firms in scope of CP4/23 and CP5/23.

The proposals set out in CP14/23 would primarily apply to:

  • ‘Simpler-regime firms’ under the proposed Strong and Simple Framework.
  • Firms that would be ‘small CRR firms’ under the PRA’s CP5/23 proposals on remuneration.
  • Small and non-complex institutions that would not be simpler-regime firms but will be eligible to be small CRR firms.

The PRA’s proposals would reduce the disclosure obligations relating to remuneration that apply to these smaller firms.

The deadline for comments on CP14/23 is 20 September 2023.

The PRA proposes to publish its final policy on remuneration disclosures as part of the Strong and Simple Framework, which is expected in Q4 2023, and to align the implementation date for proposals set out in CP14/23 with the Pillar 3 proposals set out in CP4/23, which is currently expected to be early in H2 2024.