Featured Product

    PRA Consults on Rules for Domestic Liquidity Sub-Groups

    September 28, 2021

    The Prudential Regulation Authority (PRA) proposed rules on the application of prudential liquidity requirements to domestic liquidity sub-groups. The published consultation paper (CP19/21) also proposed revisions to the approach to granting a domestic liquidity sub-groups permission. The consultation closes on October 12, 2021, with the rule finalization expected in November 2021 and the implementation date for the changes expected to be January 01, 2022.

    Where certain conditions are met on the availability, distribution, management, and monitoring of liquidity, the Capital Requirements Regulation (CRR) allows PRA to waive the application of liquidity requirements at the level of an individual firm and to permit a firm to form a domestic liquidity sub-group; these requirements encompass the liquidity coverage ratio (LCR) and liquidity risk management, monitoring, reporting, and disclosures. Where a domestic liquidity sub-groups permission is granted, PRA requirements apply at the level of a domestic liquidity sub-group on the basis of the consolidated situation of its members, rather than applying to member firms individually. This reflects the ability of some firms to manage their liquidity jointly with other entities, as if they were a single entity. HM Treasury will revoke this provision from Saturday January 01, 2022. CP19/21 proposes to:

    • Permit the inclusion in a domestic liquidity sub-group of firms that are subsidiaries of a common immediate UK qualifying parent undertaking that is not a bank or PRA-designated investment firm (referred to in this consultation as a "sibling domestic liquidity sub-group")
    • Revise the conditions to qualify for a domestic liquidity sub-group permission and the factors that PRA will take into account when considering domestic liquidity sub-group applications

    CP19/21 would result in changes to the Liquidity (CRR) Part of the PRA Rulebook and the Statement of Policy (SoP) titled "Liquidity and funding permissions." This consultation is relevant to PRA-authorized UK banks, PRA-designated UK investment firms, and building societies. It is also relevant to the UK financial or mixed financial holding companies that are the immediate parent undertakings of firms that may be included in a domestic liquidity sub-groups. It is not relevant to credit unions.


    Related Links

    Comment Due Date: October 12, 2021

    Keywords: Europe, UK, Banking, Liquidity Risk, Domestic Liquidity Sub Groups, CRR, Reporting, LCR, Disclosures, Basel, PRA

    Featured Experts
    Related Articles

    FINMA Approves Merger of Credit Suisse and UBS

    The Swiss Financial Market Supervisory Authority (FINMA) has approved the takeover of Credit Suisse by UBS.

    March 21, 2023 WebPage Regulatory News

    BOE Sets Out Its Thinking on Regulatory Capital and Climate Risks

    The Bank of England (BOE) published a working paper that aims to understand the climate-related disclosures of UK financial institutions.

    March 13, 2023 WebPage Regulatory News

    OSFI Finalizes on Climate Risk Guideline, Issues Other Updates

    The Office of the Superintendent of Financial Institutions (OSFI) is seeking comments, until May 31, 2023, on the draft guideline on culture and behavior risk, with final guideline expected by the end of 2023.

    March 12, 2023 WebPage Regulatory News

    APRA Assesses Macro-Prudential Policy Settings, Issues Other Updates

    The Australian Prudential Regulation Authority (APRA) published an information paper that assesses its macro-prudential policy settings aimed at promoting stability at a systemic level.

    March 07, 2023 WebPage Regulatory News

    BIS Paper Examines Impact of Greenhouse Gas Emissions on Lending

    BIS issued a paper that investigates the effect of the greenhouse gas, or GHG, emissions of firms on bank loans using bank–firm matched data of Japanese listed firms from 2006 to 2018.

    March 03, 2023 WebPage Regulatory News

    HMT Mulls Alignment of Ring-Fencing and Resolution Regimes for Banks

    The HM Treasury (HMT) is seeking evidence, until May 07, 2023, on practicalities of aligning the ring-fencing and the banking resolution regimes for banks.

    March 02, 2023 WebPage Regulatory News

    MFSA Sets Out Supervisory Priorities, Issues Reporting Updates

    The Malta Financial Services Authority (MFSA) outlined its supervisory priorities for 2023

    March 02, 2023 WebPage Regulatory News

    German Regulators Issue Multiple Reporting Updates for Banks

    Deutsche Bundesbank published the nationally deactivated validation rules for the German Commercial Code (HGB) users on the taxonomy 3.2, which became valid from December 31, 2022

    March 02, 2023 WebPage Regulatory News

    BCBS Report Examines Impact of Basel III Framework for Banks

    The Basel Committee on Banking Supervision (BCBS) published results of the Basel III monitoring exercise based on the June 30, 2022 data.

    February 28, 2023 WebPage Regulatory News

    PRA Consults on Prudential Rules for "Simpler-Regime" Firms

    Among the recent regulatory updates from UK authorities, a key development is the first-phase consultation, from the Prudential Regulation Authority (PRA), on simplifications to the prudential framework that would apply to the simpler-regime firms.

    February 28, 2023 WebPage Regulatory News
    RESULTS 1 - 10 OF 8806