PRA and FCA Consult on Implementing Extension of SM&CR to Insurers
PRA published the consultation paper CP28/17 that sets out the proposed changes to forms, along with other consequential changes and minor administrative amendments related to the extension of the Senior Managers and Certification Regime (SM&CR) to insurers. It also sets out proposals for the removal of gendered language from the SM&CR for banking firms and insurers. FCA also published a package of proposals (including CP17/40, CP17/41, and CP17/42) on how firms and individuals will transition to the SM&CR. All the PRA and FCA consultations close on February 21, 2018.
CP28/17 includes the following appendices: draft instrument (Appendix 1); amended Part 4A Permissions forms (Appendix 2); and the rationalized SM&CR forms for dual-regulated banking firms and insurers (Appendix 3). The key proposals in CP28/17 include:
- The rationalization of the existing SM&CR/SIMR forms to produce a streamlined set of forms, and amendments to Part 4A Permission forms (Chapter 2)
- Implementing the extension to insurers, including some transitional arrangements and changes to references to the existing Senior Insurance Managers Regime (SIMR) and Senior Insurance Management Functions or SIMFs (Chapter 3)
- The process for transferring from a Senior Management Function (SMF) at an insurance firm to a banking firm (Chapter 4)
- The removal of gendered language from the SM&CR (Chapter 5)
CP28/17 of PRA should be read in conjunction with CP8/17, which proposed optimizations to the existing SIMR, and CP14/17, which proposed the extension of the SM&CR to insurers. CP28/17 is relevant to PRA-authorized UK banks, building societies, credit unions, including UK branches of non-EEA firms, and PRA-designated UK investment firms (banking firms), Solvency II insurers (that is, UK Solvency II firms, the Society of Lloyd’s and Lloyd’s managing agents, third-country (re)insurance branches), insurance special purpose vehicles (ISPVs), large non-Directive firms (NDFs), small NDFs, and Swiss general insurers. The extended SM&CR for insurers will not come into effect until a commencement date has been set by HM Treasury, at which point PRA proposes to publish the final policy and rules. This is currently expected during 2018.
Related Links
Comment Due Date: February 21, 2018
Keywords: Europe, EU, UK, Banking, Insurance, SM&CR, SIMR, Accountability, FCA, PRA
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