PRA Issues PS26/18 on Implementing the Extension of SM&CR to Insurers
PRA published policy statement (PS26/18) that provides feedback to responses to the consultation paper CP18/18 on implementing the extension of the Senior Managers and Certification Regime (SM&CR) to insurers. PS26/18 contains amendments to the final rules for the implementation of the extension of the SM&CR to insurers, along with a technical correction to the Insurance General Application Part of the PRA Rulebook. The final rules in PS26/18 will apply from December 10, 2018.
CP18/18 garnered one response that pertained to the general overlap rule, which already applies to insurers and deposit-takers and aims to minimize the overlap between the senior managers and approved person regimes of PRA and FCA. Amendments to this rule were not consulted on by PRA in CP18/18. The policy intent behind the extension of SM&CR to insurers has been to align the rules for all dual-regulated firms wherever possible. PRA, in conjunction with FCA, will continue to monitor effectiveness of the policy for application of the overlap rule to the approval process, when an individual will be performing both a PRA senior management function and an FCA governing function.
PS26/18 should be read in conjunction with PS15/18 of PRA and PS18/15 of FCA, which involve the extension of SM&CR to insurers. The extension of the regime to insurers is being introduced by amendments to the Financial Services and Markets Act 2000 (FSMA) through the BoE and Financial Services Act 2016 (the 2016 Act). The extended SM&CR for insurers will come into effect on December 10, 2018 through the application of the Commencement regulations that have been published by HM Treasury for the relevant amendments to FSMA in the 2016 Act. Following the publication of the Commencement regulations by HM Treasury, PRA published CP20/18 with further proposed consequential technical amendments to its rules to take effect on December 10, 2018. These further consequential changes are not intended to make any substantive change to the final policy and rules in PS26/18. A further policy statement containing the final rules following the consultation in CP20/18 will be published before the commencement of SM&CR.
Related Links
Effective Date: December 10, 2018
Keywords: Europe, UK, Insurance, Solvency II, SM&CR, Responses to Consultation, PS26/18, CP18/18, FCA, PRA
Featured Experts
Adam Koursaris
Asset and liability management expert; capable modeler; risk and capital specialist
Cassandra Hannibal
Life insurance actuary; risk management and economic capital specialist
Jerome Ogrodzki
Insurance asset and liabilities modeling specialist; stochastic modeling expert
Previous Article
Bundesbank Issues Derivation Rules for Reporting Under SSMNext Article
ESRB Dashboard Examines Systemic Risks in EURelated Articles
FDIC Proposes Amendments to Real Estate Lending Standards
FDIC is seeking comments on a rule to amend the interagency guidelines for real estate lending policies—also known as the Real Estate Lending Standards.
ISDA Consults on Implementation of Fallbacks for Certain Swap Rates
ISDA is consulting on the implementation of fallbacks for the sterling LIBOR ICE Swap Rate and for the USD LIBOR ICE Swap Rate.
BIS and BoE Launch Innovation Hub in London
BIS and BoE launched the BIS Innovation Hub Center in London, which is the fourth new Innovation Hub Centre to be opened in the past two years.
ESRB Recommends Reciprocation of Certain Macroprudential Measures
ESRB published recommendations on the reciprocation of macro-prudential measures in Belgium, France, Luxembourg, Norway, and Sweden.
US Agencies Set Out Unified Agenda for Planned Regulatory Actions
SEC announced that the Office of Information and Regulatory Affairs released the Spring 2021 Unified Agenda of Regulatory and Deregulatory Actions.
EC Publishes Regulation on Key Aspects of Implementation of SA-CCR
EC published the Delegated Regulation 2021/931, which supplements the Capital Requirements Regulation (CRR or Regulation 575/2013) with regard to the regulatory technical standards specifying the method for identifying derivative transactions with one or more than one material risk driver.
BCBS Consults on Prudential Treatment of Cryptoasset Exposures
BCBS is consulting on preliminary proposals for the prudential treatment of cryptoasset exposures of banks.
EBA Revises List of Validation Rules for Reporting
EBA issued a revised list of validation rules under the implementing technical standards on supervisory reporting.
Banking Authorities and Private Sector Collaborate on Wholesale CBDC
BIS Innovation Hub, BDF, and SNB announced that, together with a private-sector consortium led by Accenture, they will conduct an experiment using wholesale central bank digital currency (wCBDC) for cross-border settlement.
ESAs Publish Amended Implementing Standards on Mapping of ECAIs
ESAs published two amended implementing technical standards on the mapping of credit assessments of External Credit Assessment Institutions (ECAIs).
