UK Regulator Confirms Revised Pillar 2 Reporting Requirements

The Prudential Regulation Authority has published a Policy Statement confirming that updated Pillar 2 reporting requirements will apply from October 1, 2018 for banks, building societies and PRA-designated investment firms. This follows the PRA's consultation on the proposed updates, which ran from December 6, 2017 to March 5, 2018. The PRA proposed a new data item to capture stress-testing data currently included in firms' Internal Capital Adequacy Assessment Process documents. This change aims to increase transparency and comparability in stress test data provided alongside ICAAP documents and to decrease the operational risks associated with capturing stress test data manually. The PRA also proposed reducing the frequency of reporting of the data items in the Reporting Pillar 2 part of the PRA Rulebook for some firms as well as consolidating the definition of several reporting parts of the PRA Rulebook into the Glossary.

The PRA received no responses to the consultation and is proceeding with the proposals as consulted, except for: (i) adding wording to Rule 2.9 of Reporting Pillar 2 to clarify that it applies to firms with total assets equal to or greater than £5 billion at the relevant level of consolidation used as the basis of their ICAAP; (ii) moving the definition of 'Supervisory Reporting ITS' to the central Glossary; and (iii) making minor amendments to reflect a change in terminology from 'Firm Data Submission Framework (FDSF)' to 'Stress Testing Data Framework (STDF)'.

The PRA has also published updated rules, an updated Supervisory Statement on Pillar 2 Reporting (SS32/15) and an updated Statement of Policy on the PRA's methodologies for setting Pillar 2 capital. Further updates to the Supervisory Statement and the Statement of Policy will apply from January 1, 2019 as a result of the PRA's amendment to the Groups policy and double leverage.

View the Policy Statement.

View the updated Supervisory Statement (October 2018).

View the updated Statement of Policy (October 2018).

View the updated PRA Rulebook rules.