PRA is consulting on its proposed statement setting out its expectations on firms in relation to the application of the matching adjustment (MA). This is for the purposes of calculating technical provisions, including in the context of applications for MA approval and the ongoing management of MA portfolios under Solvency 2. The draft statement addresses the following areas:

  • annuity assets purchased in a secondary annuity market;
  • ongoing MA compliance;
  • breach of MA requirements; and
  • changes to MA portfolios.

The consultation closes on 15 July. (Source: PRA consults on Solvency 2’s MA)