PRA Proposes Minor Changes to Rules, Guidance, and Returns
PRA published an occasional consultation paper (CP13/21) that sets out proposals to make minor amendments to the PRA Rulebook, supervisory statements, and reporting data items and instructions, including the Branch Return and the associated guidance and notes. The comment period for these proposals closes on August 25, 2021 and they cover topics such as Pillar 2A reporting, reporting changes due to London Inter-bank Offered Rate (LIBOR) discontinuation, Definition of Capital Part of PRA Rulebook, branch return, and Audit Committee Part of the PRA Rulebook. In general, the proposed changes are relevant for banks, building societies, the Capital Requirements Regulation (CRR firms), and PRA-designated investment firms, PRA-supervised third-country branches, and UK Solvency II insurance and reinsurance firms.
The amendments cover the following topics:
- Pillar 2A.The proposals in Chapter 2 of this paper would result in amendments to the reporting Pillar 2 Part of the PRA Rulebook (Appendix 1); SS32/15 on Pillar 2 reporting (Appendix 2); FSA081 template (Appendix 3); and the associated FSA081 instructions (Appendix 4). In the FSA081 template, PRA proposed to add a new asset category for insured annuities; two new entries for the life expectancies assumed for current and future pensioners; and a tick box to confirm the latest funding valuation documentation has been submitted alongside the FSA081 template. PRA also proposed to remove the asset category for other assets (data item number 220). PRA proposed to require all firms submitting an FSA081 to provide the asset and liability sensitivities known as ‘PV01’ and ’IE01’ (that is, data items 230, 240, 280, and 290 in the existing FSA081); this requirement only applies to significant firms. PRA also proposed to make formatting changes to the FSA081 template. PRA proposed to revise the FSA081 instructions to reflect these change and to improve the guidance for the existing data requirements. FSA081 data item and instructions are contained in SS32/15. Thus PRA proposed to update the relevant appendices in SS32/15, with the links to the amended data item and instructions subject to the outcome of this consultation, as shown in Appendix 2. This chapter is relevant to banks, building societies, and PRA-designated investment firms.
- Reporting changes due to LIBOR discontinuation. In Chapter 3 of the consultation paper, PRA proposed changes to reporting requirements to delete the Undertakings Collective Investment Transferable Securities (UCITS) legacy template FSA042 and to prepare for the expected discontinuation of LIBOR after the end of 2021. These proposals would result in an update to the regulatory reporting Part of the PRA Rulebook (Appendix 5); an update to SS34/15 on guidelines for completing regulatory reports (Appendix 6); deletion of the UCITS template (FSA042) from the PRA Rulebook; amendments to the "Interest rate gap report" (FSA017) and associated instructions (Appendix 7); and amendments to the Notes for completion of MLAR (Appendix 8). PRA proposed to replace LIBOR in the FSA017 instructions with compounded Sterling Overnight Index Average (SONIA) for the purposes of referencing an interest rate benchmark. This chapter is relevant to banks, building societies, and PRA-designated investment firms
- Definition of Capital. In Chapter 4, PRA sets out a proposal to change the scope of the Definition of Capital Part of the PRA Rulebook, to refer entities as the Capital Requirements Regulation (CRR) firms rather than UK banks. The proposal would result in the deletion of Rule 4.1 in the Definition of Capital Part of the PRA Rulebook (Appendix 9) and in an update to SS7/13 titled "Definition of capital (CRR firms)" (Appendix 10). This chapter is relevant to CRR firms. The Definition of Capital Part of the PRA Rulebook requires firms to assess whether funding to connected counterparties is of a capital nature; if so, it requires firms to treat it in a similar way under the relevant CRR requirements. Due to this change, PRA proposed to replace existing references to "banks" with "firms" in Section 8 of SS7/13, subject to the outcome of this consultation.
- Branch Return. In Chapter 5, PRA sets out proposals with regard to the Branch Return, to amend the method of submission, make minor formatting corrections to the Branch Return, and to clarify the accompanying reporting guidance. These proposals would result in amendments to the Regulatory Reporting Part of the PRA Rulebook (Appendix 5); an update to SS34/15 on guidelines for completing regulatory reports’ (Appendix 11); an updated Branch Return template (Appendix 12); and an updated reporting guidance (Appendix 13). PRA proposed to change the method of submission of the Branch Return from Excel templates submitted via e-mail, to a submission of XML-format documents via the BoE Electronic Data Submission (BEEDS) portal. PRA proposed other minor formatting changes to the Branch Return and note that this chapter is relevant to the PRA-supervised third-country branches.
- Audit Committee and Auditors. In Chapter 6, PRA sets out proposals to correct and update a reference in Rule 2.4(5) in the Audit Committee Part of the PRA Rulebook (Appendix 14) and to correct an error in SS1/16 titled "Written reports by external auditors to the PRA" (Appendix 15). This chapter is relevant to Audit Committee – CRR firms, UK Solvency II insurance and reinsurance firms, the Society of Lloyd’s and managing agents, and Auditors – major UK banks and building societies, as set out in Chapter 8 of the Auditors Part of the PRA Rulebook.
Pending consideration of the responses to this consultation, the proposed implementation dates for the changes resulting from this consultation are December 01, 2021 for Chapter 2; January o1, 2022 for Chapters 4 and 6; and on publication of the final policy for Chapters 3 and 5.
Related Links
Comment Due Date: August 25, 2021
Keywords: Europe, UK, Banking, Insurance, Securities, PRA Rulebook, CP13/21, LIBOR, CRR, Reporting, Branch Return, BEEDS, FSA081, Investment Firms, Pillar 2, Basel, Regulatory Capital, PRA
Featured Experts

María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer

Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.

Patrycja Oleksza
Applies proficiency and knowledge to regulatory capital and reporting analysis and coordinates business and product strategies in the banking technology area
Previous Article
FED Extends PPPLF to July 2021, Updates Forms FR Y-14Q and FR Y-9CRelated Articles
OSFI Discusses Benchmark Rate Transition, Sets Out Work Priorities
The Office of the Superintendent of Financial Institutions (OSFI) published the strategic plan for 2022-2025 and the departmental plan for 2022-23.
EBA Proposes Standards to Support Secondary NPL Markets
The European Banking Authority (EBA) is consulting, until August 31, 2022, on the draft implementing technical standards specifying requirements for the information that sellers of non-performing loans (NPLs) shall provide to prospective buyers.
EU Confirms Agreement on Rules on Cybersecurity and Banking Resolution
The European Council and the Parliament reached an agreement on the revised Directive on security of network and information systems (NIS2 Directive).
EBA Issues Standards for Crowdfunding Service Providers Under ECSPR
The European Banking Authority (EBA) published the final draft regulatory technical standards specifying information that crowdfunding service providers shall provide to investors on the calculation of credit scores and prices of crowdfunding offers.
EU Confirms Agreement on Rules on Cybersecurity and Banking Resolution
The European Securities and Markets Authority (ESMA) published a paper that examines the systemic risk posed by increasing use of cloud services, along with the potential policy options to mitigate this risk.
EC Consults on PSD2 and Open Finance; EU Reaches Agreement on DORA
The European Commission (EC) published a public consultation on the review of revised payment services directive (PSD2) and open finance.
EC Mandates ESAs to Propose Amendments to SFDR Technical Standards
The European Commission (EC) has issued two letters mandating the European Supervisory Authorities (ESAs) to jointly propose amendments to the regulatory technical standards under Sustainable Finance Disclosure Regulation or SFDR.
EBA Examines Supervisory Practices, Issues Deposits Reporting Template
The European Banking Authority (EBA) published its annual report on convergence of supervisory practices for 2021. Additionally, following a request from the European Commission (EC),
SNB Updates NSFR Forms and FINMA Consults on Operational Risk Circular
The Swiss National Bank (SNB) published Version 1.2 of the reporting forms (NSFR_G and NSFR_P) on the net stable funding ratio (NSFR) of banks, along with the associated documentation.
US Agency Publications Address Basel, Reporting, and CECL Developments
The Farm Credit Administration published, in the Federal Register, the final rule on implementation of the Current Expected Credit Losses (CECL) methodology for allowances