Designation of firms within certain consolidation groups

Consultation Paper 22/20
Published on 09 December 2020

Update 28 December 2020: The PRA received no responses to CP22/20. The PRA therefore published the policy as proposed. Please see PS29/20 ‘Capital Requirements Directive V (CRD V)’ for further details.

Overview

This Consultation Paper (CP) sets out the Prudential Regulation Authority’s (PRA) proposed approach to designating entities within certain banking UK consolidation groups as responsible for ensuring that consolidated prudential requirements are met during a transitional period. Relevant holding companies will need to apply for approval or exemption in accordance with The Financial Holding Companies (Approval etc.) and Capital Requirements (Capital Buffers and Macro-prudential Measures) (Amendment) (EU Exit) Regulations 2020. The proposals in this CP apply to the period between Monday 28 December 2020 and the date on which the UK parent holding company’s application for approval or exemption is finally determined.

The PRA proposes to create a new Part of the PRA Rulebook (the Designation Part).

This CP is relevant to banks and PRA-designated investment firms that are part of a UK consolidation group controlled by a UK parent financial holding company or a UK parent mixed financial holding company.

Implementation

The PRA proposes an implementation date for changes resulting from this CP of Monday 28 December 2020, to coincide with the transposition date for CRD V and the application of the relevant CRR II requirement on Monday 28 December 2020.

Responses and next steps

This consultation closes at 5pm on Wednesday 16 December 2020. Please note that this is a shortened consultation period, necessary to meet the transposition date for CRD V and the application of the relevant CRR II requirement on Monday 28 December 2020. The PRA previously addressed this matter as part of CP17/20.

The PRA invites feedback on the proposals set out in this consultation. Please address any comments or enquiries to CP22_20@bankofengland.co.uk.

The proposals set out in this CP have been designed in the context of the UK’s withdrawal from the European Union and the application of European law for the duration of the transition period. The proposals set out in this CP would continue to apply after the end of the transition period, with appropriate provision to address any deficiency arising from the withdrawal of the UK from the EU.

Consultation Paper 22/20 Opens in a new window Opens in a new window Opens in a new window Opens in a new window

Consultation end date: 16 December 2020

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