Shearman & Sterling LLP | FinReg | UK Proposes Rules to Implement France's Large Exposure Limit for Highly Indebted Corporates
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  • UK Proposes Rules to Implement France's Large Exposure Limit for Highly Indebted Corporates
    07/16/2019
    The U.K. Prudential Regulation Authority has published a consultation on proposals to reciprocate the French measure on large exposures, following a recommendation by the European Systemic Risk Board. In July 2018, France's Haut Conseil de stabilité financière (HCSF) imposed a measure under the Capital Requirements Regulation that lowers the large exposure limit, from 25% to 5% of a firm's eligible capital, for French G-SIIs and French O-SIIs for their exposures to French NFCs that are 'highly indebted'.

    The PRA is proposing to apply the same 5% large exposure limit for exposures to certain French NFCs through amendments to the Large Exposures part of the PRA Rulebook. The proposals would apply to Global Systemically Important Institutions and Other Systemically Important Institutions from January 1, 2020.

    Responses to the consultation should be submitted to the PRA by September 6, 2019.

    View the consultation paper.

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