On 8 November 2021, the PRA published Policy Statement 25/21: Responses to CP13/21 ‘Occasional Consultation Paper’ (PS25/21).
In PS25/21 the PRA provides feedback to responses to Consultation Paper 13/21: ‘Occasional Consultation Paper’ (CP13/21). It also contains the final rules, updated Supervisory Statements, and updated templates, instructions, and associated guidance and notes.
In CP13/21 the PRA proposed to:
- Amend the reporting requirements to support a better understanding of defined benefit pension schemes’ risk profiles, improve consistency, and ensure a level playing field for firms (chapter 2).
- Amend the reporting requirements to delete a legacy template and to update rules and policy documents, to prepare for the expected discontinuation of LIBOR at the end of 2021 (chapter 3).
- Amend the scope of Chapter 4 of the Definition of Capital Part of the PRA Rulebook, to refer to CRR (Capital Requirements Regulation) firms rather than UK banks (chapter 4). The purpose of the rules is to expand the scope of Chapter 4 of the Definition of Capital Part of the PRA Rulebook to all CRR (Capital Requirements Regulation) firms rather than only UK banks. The amended scope of these rules provide clarity on their application, and therefore will ensure that all PRA-authorised firms comply with the purpose, as well as the letter, of the CRR in treating all connected funding of a capital nature as a holding of capital of the connected party.
- Amend the method of submission, make minor formatting corrections to the Branch Return, and clarify the accompanying reporting guidance (chapter 5).
- Correct and update a reference in Rule 2.4(5) in the Audit Committee Part of the PRA Rulebook, and to correct an error in Supervisory Statement 1/16 ‘Written reports by external auditors to the PRA’ (chapter 6).
In PS25/21 the PRA states that it has made minor amendments to the proposed FSA081 instructions discussed in chapter 2 of CP13/21 in order to correct typos and improve readability of the text and forms. Also, having considered feedback to the consultation, the PRA has also made minor amendments to the proposed Branch Return guidance discussed in chapter 5 of CP13/21 in order to improve clarity and ensure consistency of the reporting.
The PRA has also amended the effective date for the changes discussed in chapter 3 of CP13/21. The deletion of FSA042 will come into force on 10 November 2021. The changes to the FSA017 instructions and MLAR guidance notes will now come into force on 1 January 2022 to align the instructions with the timing of the discontinuation of LIBOR. Supervisory Statement 34/15 will be updated on 10 November 2021 to delete the link to FSA042, and again on 1 January 2022 to include the updated links to the FSA017 and MLAR guidance notes. This amendment will also align with the FCA’s effective date for changes to the MLAR guidance note.
The implementation dates for the policy changes set out in PS25/21 are:
- Chapter 2: 1 December 2021.
- Chapter 3: 10 November 2021 for the deletion of FSA042, and 1 January 2022 for FSA017 instructions and MLAR guidance notes.
- Chapters 4 and 6: 1 January 2022.
- Chapter 5: 31 May 2022.