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  • UK Prudential Regulator Consults on its Approach to Supervising International Banks

    The U.K. Prudential Regulation Authority has launched a consultation on its proposed approach to supervising international banks. The proposals cover the U.K. activities of PRA-authorized banks and designated investment firms that are headquartered outside of the U.K. or are part of a group based outside of the U.K., including those firms operating in the U.K. through a branch. Responses to the consultation may be submitted until April 11, 2021. Implementation of the final policy is expected to occur in Q2 2021, except for those EEA firms that are in the Temporary Permissions Regime which are expected to meet the expectations "as soon as reasonably practicable" and at least by the time the firm is authorized and exits the TPR.

    The proposed Supervisory Statement will replace the existing Supervisory Statement, 'International banks: the Prudential Regulation Authority's approach to branch authorisation and supervision' (SS1/18). The proposed Supervisory Statement sets out the PRA's expectations for receiving information about the risks in a firm's group and cooperation from other supervisory authorities to ensure that the PRA is assured that an international bank is meeting the relevant U.K. threshold conditions, particularly the threshold conditions for effective supervision of the firm and the prudent conduct of business. The proposed Supervisory Statement discusses the PRA's approach on a range of topics, such as resolution, ring-fencing, booking arrangements and structure, and discusses the relationship between a firm's size and systemic importance, the information, cooperation and controls to ensure effective supervision and the degree of independence between U.K. and overseas business.

    View the consultation paper.

    View the proposed Supervisory Statement.

    View the existing Supervisory Statement.

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