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Critical Third Parties serving the UK financial sector must ready themselves for compliance with the newly proposed operational resilience requirements.

By Rob Moulton, Fiona Maclean, and Charlotte Collins

On 7 December 2023, the PRA, FCA, and BoE jointly published a Consultation Paper (PRA CP26/23 and FCA CP23/30) which proposes a set of regulatory requirements and expectations for critical third parties (CTPs) that provide services to authorised persons, relevant service providers, and financial market infrastructure entities (FMIs). The key aim of the proposals is to manage potential risks to the stability of, or confidence in, the UK financial system that may arise due to a failure in, or disruption to, the services that a CTP provides to such entities.

The proposals would give the Bank of England wide-ranging powers to deal with acute failure scenarios, treating policyholder liabilities as loss-absorbing.

By Victoria Sander and Tim Scott

HM Treasury is proposing a new UK resolution regime for insurers that would appoint the Bank of England as resolution authority with sweeping powers to resolve insurers through transfer or bail-in, and to make resolution plans and assess resolvability in advance. The regime would share many similarities with the Banking Act 2009 (BA09).

Following this spring’s shocks to the banking system, US, UK, and European regulators are considering whether existing regulatory and crisis management measures require reform and enhancement.

By David Berman, Nicola Higgs, Markus E. Krüger, Arthur S. Long, Rob Moulton, Axel Schiemann, Pia Naib, Ja Hyeon Park, Deric Behar, and Charlotte Collins

The spring of 2023 saw more dislocation in the global financial sector than any time since the 2008-09 financial crisis.…

The regulator is taking immediate supervisory and policy measures to help support banks, insurers, and financial market infrastructures.

By Rob Moulton and Charlotte Collins

The Bank of England and the Prudential Regulation Authority (PRA) have announced a number of measures aimed at alleviating operational burdens on PRA-regulated firms, and Bank-regulated financial market infrastructures (FMIs), in the wake of the COVID-19 outbreak. These measures are intended to provide flexibility to help firms and FMIs focus on maintaining their safety and soundness and delivering the critical functions they provide to the economy.

This follows the earlier announcement by the FCA providing information on its expectations regarding regulated firms’ response to the coronavirus.