PRA publishes SMR rules: PRA has published its first set of final rules implementing the Senior Manager Regime (SMR) and certification regime for banks, building societies and PRA-designated investment firms, and its SMR for Solvency 2 insurers. Both regimes take effect from 7 March 2016, but some of the Solvency 2-related rules will take effect on 1 January 2016. The feedback statement clarifies PRA's views on the Group Entity Senior Manager function and applying a simplified SMR to smaller firms. It also addresses allocation of responsibilities and the certification regime. It includes a table of the PRA prescribed responsibilities. For Solvency 2 firms, the feedback addresses governance maps and clarification of what is a "key function". The paper annexes three new instruments for the PRA Rulebook:

  • the CRR Firms Non-CRR firms: Individual Accountability Instrument 2015;
  • the Solvency 2 firms: Senior Insurance Managers Regime - Solvency 2 Instrument 2015; and
  • the Solvency 2 firms: Senior Insurance Managers Regime Instrument 2015.

PRA will publish further rules later this year, including those applying the regime to branches of non-EEA banks and to Non-Executive Directors. (Source: PRA Publishes SMR Rules)

PRA updates on accountability: PRA has published a timetable showing how it is strengthening accountability across its regulated community. (Source: PRA Updates on Accountability)

PRA consults on fee levy: BoE has set the Annual Funding Requirement (AFR) for PRA. This is £257.8 million, a 4% increase on last year's. The increase results from the implementation work on Solvency 2, the Capital Requirements Directive (CRD4) and the Senior Managers Regime and PRA's stress testing work. PRA explains how it proposes to allocate fees among the fee blocks. Consultation on the way in which PRA proposes to raise the fees closes on 19 May. (Source: PRA Consults on Fee Levy PRA)

PRA publishes Solvency 2 rules: PRA has published its final rules implementing Solvency 2  into its rulebook. It has published, alongside the rules, a policy statement explaining how it will implement the "long-term guarantees package", and a consultation paper on how to apply for the volatility adjustment. The policy statement covers:

  • the matching adjustment;
  • the volatility adjustment;
  • risk management for the long-term guarantees measures;
  • transitional measures;
  • external credit rating assessments;
  • groups;
  • insurance special purpose vehicles;
  • third-country branches;
  • surplus funds;
  • cancellation of dividends on ordinary shares;
  • reporting - national specific templates;
  • with profits; and
  • appointment of actuaries.

It annexes 22 new modules to its Rulebook and amendments to the Glossary as well as 17 new supervisory statements. Firms wishing to make use of the volatility adjustment can apply from 1 April, and PRA will assess applications on a case-by-case basis. It plans to operate a harmonised approval process so it can consider in parallel applications where firms wish to have both matching and volatility adjustments. PRA asks for comment on these proposals by 20 April. (Source: PRA Publishes Solvency 2 Rules)

PRA publishes waivers page: PRA has given guidance to firms setting out information it finds helpful in the context of applications for waivers or modifications. The page includes details of Solvency 2 waivers. (Source: PRA Publishes Waivers Page)