PRA Issues Amendments to Prescribed Responsibility Under SM&CR
PRA published the statement PS20/19 on the final policy on amendments to the prescribed responsibility for recovery plans and resolution packs in the Allocation of Responsibilities part of the PRA Rulebook. PS20/19 contains the supervisory statement SS28/15, titled "Strengthening individual accountability in banking," along with the SoR form titled "Senior Managers Regime: Statement of Responsibilities." PS20/19 provides feedback to the responses to the consultation paper (CP12/19) on resolution assessments and reporting amendments. All changes outlined in PS20/19 will take effect from December 09, 2019.
PRA received one response to the points raised in CP12/19. The respondent was supportive of the proposed amendments to the wording of the prescribed responsibility for recovery and resolution and minor amendments to the SoR form. The respondent called for the alignment of the wording used in the PRA Rulebook and the FCA Handbook with the SoR form, to describe the prescribed responsibilities that must be assigned to one or more Senior Management Function holders under the Senior Managers and Certification Regime (SM&CR). No other comments were directed to the policy and administrative proposed changes set out in CP12/19 or to the policy development process in respect of these proposals. In the absence of feedback questioning the proposed changes set out in CP12/19, PRA will implement these proposals with a small modification to the revised wording for SS28/15. This decision also reflects the publication of final rules and PS15/19 on resolution assessment and public disclosure by firms.
PRA and FCA acknowledge that stylistic differences exist between PRA and FCA SM&CR rules on the precise wording of the prescribed responsibilities; however, the definitions in the SoR form are a simplified explanation of both regulators’ definitions of prescribed responsibilities. CP12/19 did not consult on this matter and, therefore, PRA (alongside FCA) would be required to undertake a new consultation to bring about such an alignment. As the differences are stylistic, PRA does not propose to make further changes to this form, but it will be kept under review.
The policy set out in PS20/19 has been designed in the context of the current UK and EU regulatory framework. PRA will keep the policy under review to assess whether any changes would be required due to changes in the UK regulatory framework, including those arising once any new arrangements with EU take effect. If UK leaves EU with no implementation period in place, PRA has assessed that the policy would not need to be amended.
Related Links
Effective Date: December 09, 2019
Keywords: Europe, UK, Banking, Insurance, SM&CR, Operational Risk, PS 20/19, CP 12/19, Governance, Recovery and Resolution, PRA, FCA
Featured Experts
María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer
Dieter Van der Stock
IFRS subject matter expert; LDTI subject matter expert; accounting authority; risk management specialist
Previous Article
HKMA Publishes Templates for Loss Absorbing Capacity DisclosuresRelated Articles
BIS and Central Banks Experiment with GenAI to Assess Climate Risks
A recent report from the Bank for International Settlements (BIS) Innovation Hub details Project Gaia, a collaboration between the BIS Innovation Hub Eurosystem Center and certain central banks in Europe
Nearly 25% G-SIBs Commit to Adopting TNFD Nature-Related Disclosures
Nature-related risks are increasing in severity and frequency, affecting businesses, capital providers, financial systems, and economies.
Singapore to Mandate Climate Disclosures from FY2025
Singapore recently took a significant step toward turning climate ambition into action, with the introduction of mandatory climate-related disclosures for listed and large non-listed companies
SEC Finalizes Climate-Related Disclosures Rule
The U.S. Securities and Exchange Commission (SEC) has finalized the long-awaited rule that mandates climate-related disclosures for domestic and foreign publicly listed companies in the U.S.
EBA Proposes Standards Related to Standardized Credit Risk Approach
The European Banking Authority (EBA) has been taking significant steps toward implementing the Basel III framework and strengthening the regulatory framework for credit institutions in the EU
US Regulators Release Stress Test Scenarios for Banks
The U.S. regulators recently released baseline and severely adverse scenarios, along with other details, for stress testing the banks in 2024. The relevant U.S. banking regulators are the Federal Reserve Bank (FED), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC).
Asian Governments Aim for Interoperability in AI Governance Frameworks
The regulatory landscape for artificial intelligence (AI), including the generative kind, is evolving rapidly, with governments and regulators aiming to address the challenges and opportunities presented by this transformative technology.
EBA Proposes Operational Risk Standards Under Final Basel III Package
The European Union (EU) has been working on the final elements of Basel III standards, with endorsement of the Banking Package and the publication of the European Banking Authority (EBA) roadmap on Basel III implementation in December 2023.
EFRAG Proposes XBRL Taxonomy and Standard for Listed SMEs Under ESRS
The European Financial Reporting Advisory Group (EFRAG), which plays a crucial role in shaping corporate reporting standards in European Union (EU), is seeking comments, until May 21, 2024, on the Exposure Draft ESRS for listed SMEs.
ECB to Expand Climate Change Work in 2024-2025
Banking regulators worldwide are increasingly focusing on addressing, monitoring, and supervising the institutions' exposure to climate and environmental risks.
