PRA policy statement on approach to new and growing banks
Regulatory Updates | 19/04/21
The Prudential Regulation Authority (PRA) published a policy statement (PS 8/21) setting out its approach to non-systemic UK banks. PS 8/21 contains feedback to responses to the PRA’s July 2020 consultation on supervising new and growing non-systemic UK banks.
Respondents generally welcomed the PRA’s proposals, but made some observations and requests for clarification. Among other things, the PRA has clarified:
- the scope of firms covered by the policy;
- its approach for new and growing banks in relation to exiting the market in an orderly way;
- existing resolvability expectations that banks need to demonstrate on an on-going basis;
- its expectations around a firm’s path to achieving profitability; and
- its expectations relating to board independence and what is good practice.
The PRA’s final policy is effective from 15th April 2021.
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