The FSA has proposed guidance on the Individual Liquidity Systems Assessment (ILSA) rules in the FSA Handbook relating to liquidity in Chapter 12 of the Prudential sourcebook for Banks, Building Societies and Investment Firms (BIPRU 12). This guidance is likely to be of relevance to firms that have been granted a simplified ILAS waiver under the liquidity regime. The guidance details:

  • a proposed format for the ILSA;
  • the areas of a firm’s liquidity risk management policy and processes which the FSA expects to see included as part of a firm's ILSA; and
  • the supporting documentation the FSA expects to see when it reviews a firm’s ILSA.

The FSA states that the proposed format is not mandatory, and that the proposed guidance for the ILSA Submission Information document does not change the standards set out in the BIPRU 12 rules. Responses are requested by 23 November 2010.