HM Treasury Publishes Results of Consultation on CRD V Implementation10/15/2020HM Treasury has published a summary of the responses to its consultation on the U.K.'s implementation of the fifth Capital Requirements Directive, together with HM Treasury's proposed next steps. CRD V came into force in July 2019 and EU Member States are required to implement the majority of its provisions by December 28, 2020. As this is prior to the end of the U.K.'s Brexit transition period, the U.K. is obliged to transpose these provisions of CRD V that are applicable before the end of the transition period into U.K. law under the terms of the EU-U.K. Withdrawal Agreement. The final legislation will address certain comments raised by respondents and the report highlights certain notable aspects of the final rules, including:
- The Prudential Regulation Agreement and Financial Policy Committee will be given powers to set and apply buffers for Other Systemically Important Institutions (institutions that are more likely to create risks to financial stability), although the PRA will maintain CRD IV rates until at least January 2023;
- The PRA will be given power over the CRD V Systemic Risk Buffer, enabling it to continue to apply the macro-prudential Sectoral Capital Requirements; and
- Holding companies that are required to comply with CRD V or the Capital Requirement Regulation will be subject to a bespoke approval regime and the PRA will be given powers to remove members of management of such companies.
Respondents agreed with the proposal in HM Treasury's consultation paper that gender neutral remuneration requirements under CRD V were already satisfied by existing U.K. legislation.
View the PRA's consultation response.
View details of HM Treasury's consultation on the implementation of CRD V.
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