May 01, 2019

PRA published the systemic risk buffer rates for ring-fenced banks (RFBs) and large building societies. PRA has set systemic risk buffer rates for RFBs in five RFB sub-groups—Lloyds Banking Group RFB sub-group, Royal Bank of Scotland RFB sub-group, Barclays RFB sub-group, HSBC RFB sub-group, and Santander UK RFB sub-group— and these systemic risk buffer rates apply to all exposures, on a sub-consolidated basis. PRA has set a systemic risk buffer rate for the Nationwide Building Society at 1%, which applies to all exposures, on a consolidated basis. The systemic risk buffer rates will be applicable from August 01, 2019

For these RFBs, if the group is not subject to a global systemically important bank (G-SIB) buffer or if the group has a G-SIB buffer rate that is lower than the systemic risk buffer rate, there will be an increase in both the group PRA buffer and the Leverage Ratio Group Add-on. This is to ensure that, where systemic buffers apply at different levels of consolidation, there is sufficient capital within the consolidated group and it is distributed appropriately, to address both global systemic risks and domestic systemic risks. 

From January 01, 2019, PRA is required to set systemic risk buffer rates for RFBs and large building societies (together, systemic risk buffer institutions) by applying the framework of Financial Policy Committee for systemic risk buffer. PRA has set out its approach to the implementation of the systemic risk buffer in its Statement of Policy published in December 2018. PRA has set systemic risk buffer rates by applying the FPC’s framework to the total assets of the systemic risk buffer institutions as of the end of December 2018, assessed on a sub-consolidated basis for RFBs and on a consolidated basis for building societies. In future, PRA expects to publish the systemic risk buffer rates by December 15 of each year, with application by January 01 of the second year following the calendar year when the rates are published.

 

Related Links

Keywords: Europe, UK, Banking, Systemic Risk Buffer, Ring Fencing, CRR, CRD, Systemic Risk, PRA

Related Articles
News

APRA Releases Minor Changes to Reporting Standards on SA-CCR for Banks

APRA released minor changes to the three reporting standards for the standardized approach for measuring counterparty credit risk exposures (SA-CCR).

May 22, 2019 WebPage Regulatory News
News

APRA on Industry Self-Assessments into Governance and Accountability

APRA released an information paper analyzing the self-assessments performed by 36 of the country’s largest banks, insurers, and superannuation licensees in response to the final report on the Prudential Inquiry into the Commonwealth Bank of Australia (CBA).

May 22, 2019 WebPage Regulatory News
News

APRA Proposes to Amend Guidance on Residential Mortgage Lending

APRA is consulting on revisions to the prudential practice guide APG 223 on residential mortgage lending in Australia.

May 21, 2019 WebPage Regulatory News
News

IASB Proposes Improvements to IFRS 9 and IFRS 16

IASB published the exposure draft ED 2019/2 that proposes amendments to four IFRS standards, including IFRS 9 on Financial Instruments and IFRS 16 on Leases.

May 21, 2019 WebPage Regulatory News
News

ESAs Amend Technical Standards on Mapping of ECAIs Under CRR

ESAs published a second amendment to the implementing technical standards on the mapping of credit assessments of External Credit Assessment Institutions (ECAIs) for credit risk under the Capital Requirements Regulation (CRR).

May 20, 2019 WebPage Regulatory News
News

OCC Consults on Information Collection for Home Mortgage Disclosures

OCC is soliciting comment on the revision of the information collection titled “Regulation C—Home Mortgage Disclosure.” OCC also notes that it has sent the collection to OMB for review.

May 20, 2019 WebPage Regulatory News
News

ESMA Updates the List of Guidelines Under Its Mandate in May 2019

ESMA updated the overview of guidelines published under its mandate, with information and links to the related documents.

May 20, 2019 WebPage Regulatory News
News

OCC Report Examines Key Risks for Federal Banking System

OCC published the Semiannual Risk Perspective for Spring 2019.

May 20, 2019 WebPage Regulatory News
News

EIOPA Updates Q&A on Regulations in May 2019

EIOPA published additional questions and answers (Q&A) on guidelines, directives, and regulations applicable to insurers in Europe.

May 17, 2019 WebPage Regulatory News
News

FSB Publishes Update on Meeting of RCG for Americas

FSB published a summary of the meeting of its Regional Consultative Group (RCG) in Americas.

May 17, 2019 WebPage Regulatory News
RESULTS 1 - 10 OF 3111