Published on 5 March 2019
Responses to Chapters 3-7 of CP24/18 ‘Occasional Consultation Paper’ – PS6/19
Overview
This Prudential Regulation Authority (PRA) Policy Statement (PS) provides feedback to responses to Chapters 3 to 7 of Consultation Paper (CP) 24/18 ‘Occasional Consultation Paper’.
The appendices to this PS provide links to the final rules amending Parts of the PRA, Rulebook, final SSs and final SoPs, as set out in the table below:
| CP24/18 Chapter | Rulebook Part/SS/SoP/Form | Appendix |
|---|---|---|
| 3. Ring fencing – imposition of financial penalties under section 142S of FSMA |
SoP ‘The PRA’s approach to enforcement: statutory statements of policy and procedure’ |
1 |
| 4. Written reports by external auditors to the PRA |
Auditors Part |
2 |
| SS1/16 ‘Written reports by external auditors to the PRA’ |
3 | |
| 5. Depositor Protection Part – minor updates |
Depositor Protection Part |
4 |
| 6. Policyholder Protection Part – minor updates |
Policyholder Protection Part |
5 |
| 7. Reporting templates for calculating risk based levies to reflect the European Banking Authority’s (EBA) transition to FINREP taxonomy |
SoP ‘Calculating risk-based levies for the Financial Services Compensation Scheme deposits class’ |
6 |
The PRA received four responses to the CP. Three of these responses related to Chapter 4, the PRA’s feedback to these responses is set out in Chapter 2. One response supported all of the proposals put forward in CP24/18, and so does not require feedback.
This PS is relevant to all PRA-authorised firms.
Additional Changes
Following consultation on Chapter 3 of CP24/18, the PRA has decided to exclude the following proposed addition at paragraph 5 of the SoP ‘The PRA’s approach to enforcement: statutory statements of policy and procedure: ‘The PRA may also, under section 142S(2) and (3) of the Act, impose on a QPU of a ring-fenced body a penalty or, alternatively, publish a public censure.’
The PRA has also made some other minor adjustments to the final policy, details of which are set out in the relevant section of Chapter 2 of this PS. The PRA also does not consider that these changes are significant or will have a differential impact on mutuals.
Implementation
The implementation date for all policy changes set out in this PS is Thursday 7 March 2019.
For the proposals relating to Chapter 4 of CP24/18 this means the final policy should be applied to Audit related to periods ending on 31 December 2018 or later (the reports which would be due from April 2019).
Policy Statement 6/19- Appendix 1: SoP ‘The PRA’s approach to enforcement: statutory statements of policy and procedure’
- Appendix 2: Amendments to the Auditors Part of the PRA Rulebook (pdf)
- Appendix 3: SS1/16 ‘Written reports by external auditors to the PRA’
- Appendix 4: Amendments to the Depositor Protection Part of the PRA Rulebook (pdf)
- Appendix 5: Amendments to the Policyholder Protection Part of the PRA Rulebook (pdf)
- Appendix 6: SoP ‘Calculating risk-based levies for the Financial Services Compensation Scheme deposits class’
Published on 20 December 2018
Responses to Chapter 2 of CP24/18 ‘Occasional Consultation Paper’ - PS33/18
Introduction
This Prudential Regulation Authority (PRA) Policy Statement (PS) provides feedback to responses, and the final rules (Appendix 1) and Branch Return form (Appendix 2), to Chapter 2 of Consultation Paper (CP) 24/18 ‘Occasional Consultation Paper’ (Page 2 of 2). The final rules amend the Incoming Firms and Third Country Firms Part of the PRA Rulebook.
This PS is relevant to all PRA-supervised firms operating through branches in the United Kingdom which are not UK-headquartered firms (‘firms’). These firms are required by Incoming Firms and Third Country Firms 3.1 to submit the Branch Return form on a semi-annual basis.
In CP24/18 the PRA proposed to amend the Branch Return form by adding a pre populated drop-down menu in a new field on the form to denote the accounting standards used by submitting firms. The purpose of the proposed field is to facilitate interpretation of the data provided by firms.
Responses received
The PRA received one response to the CP. The respondent suggested that the content of the drop-down menu be expanded to include more specific applications of accounting standards, for example ‘FRS 102 with IAS 39’ or ‘FRS 102 with Chapter 11 and 12’ in cases where UK Generally Accepted Accounting Principles (GAAP) is applied. The PRA has considered the response and decided not to make changes to the draft Branch Return form. The PRA considers that the proposed level of granularity was sufficient to meet its needs while not being unduly burdensome on firms. Furthermore, UK GAAP will generally not be relevant to the non-UK firms completing the branch return.
Implementation
The revised rules and Branch Return form will take effect from Tuesday 1 January 2019.
Appendices
Published on 22 October 2018
Occasional Consultation Paper - CP24/18
Overview
This Consultation Paper (CP) sets out proposed changes to Prudential Regulation Authority (PRA) Rulebook Parts, supervisory statements (SSs), statements of policy (SoPs) and forms.
This CP is relevant to all PRA-authorised firms.
The chapters contained in this CP, the Rulebook Parts, SSs, SoPs and forms they propose to change, and the appendices where the draft policy is set out, are listed in the table below.
| Chapter | Rulebook Part/SS/SoP/Form | Appendix |
|---|---|---|
| 2. Reporting – amendment to the Branch Return | Incoming Firms and Third Country Firms Part | 1 |
| Branch Return Form | 2 | |
| 3. Ring fencing – imposition of financial penalties under section 142S of FSMA | SoP ‘The PRA’s approach to enforcement: statutory statements of policy and procedure’ | 3 |
| 4. Written reports by external auditors to the PRA | Auditors Part | 4 |
| SS1/16 ‘Written reports by external auditors to the PRA’ | 5 | |
| 5. Depositor protection – minor updates | Depositor Protection Part | 6 |
| 6. Policyholder Protection Part – minor updates | Policyholder Protection Part | 7 |
| 7. Reporting templates for calculating risk based levies to reflect the European Banking Authority’s (EBA) transition to FINREP taxonomy | SoP ‘Calculating risk-based levies for the Financial Services Compensation Scheme deposits class’ | 8 |
The policy contained in this CP has been designed in the context of the current UK and EU regulatory framework. The PRA will keep the policy under review to assess whether any changes would be required due to changes in the UK regulatory framework, including changes arising once any new arrangements with the European Union take effect.
Implementation
Pending consideration of the responses to the consultation, the proposed implementation dates for the proposals are:
- Tuesday 1 January 2019 for Chapter 2;
- audits related to periods ending on 31 December 2018 or later (the reports which would be due from April 2019) for Chapter 4;
- on publication of the final policy for Chapters 3, 5, 6 and 7.
Responses and next steps
The consultation closed on Thursday 22 November 2018 for Chapter 2; and closed on Tuesday 22 January 2019 for Chapters 3, 4, 5, 6 and 7.
The PRA invites feedback on the proposals set out in this consultation. Please address any comments or enquiries to OCP.responses@bankofengland.co.uk.