PRA Issues Amendments to Prescribed Responsibility Under SM&CR

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

• PS20/19 and CP12/19
• PRA Rulebook (PDF)
• SS28/15
• SoR Form (PDF)

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