Posted on: January 30, 2023
Contingent Leverage Reporting
Whistlebrook is aware of the PRA’s taxonomy 3.6.0, which is out for consultation until 3Rd February 2023. The taxonomy is to support collection of Contingent Leverage data that are to be submitted by firms subject to the UK Leverage Ratio Framework. The first report reference date will be 31st December 2023. Submissions will be required semi-annually. Any changes needed to WIRES, in order that the scenario of reporting is accommodated, will be undertaken later in the year.
PRA consultation paper 16-22 describes the proposed implementation of Basel 3.1 in the UK. Whistlebrook understands that some clients will have a choice of applying either:
- The Transitional Capital Regime i.e. UK CRR as it is at 31st December 2024, until the ‘Strong and Simple Framework’ becomes effective, or
- Basel 3.1 with effect from 1st January 2025.
As a result, there will be changes to regulatory templates (deletions, amendments and additions) and to disclosure reports. These alterations, together with an expected new PRA taxonomy, will be incorporated into WIRES, to support clients in the regulatory choice that they make.
Of note, in consultation paper 16-22, is the increase to the upper assets limit (raised from £15bn to £20bn averaged over the previous twelve FINREP F 01.01 submissions) in the criteria to be met to qualify as a ‘simpler regime firm’. It is these entities that will choose either Basel 3.1 or the Transitional Capital Regime.
Mortgage Guarantee Scheme
Firms will be aware that the Government 20% guarantee residential mortgage scheme, set to expire at the end of 2022, is extended by a year. Whistlebrook understands that under this scheme, the UK Government guarantees 20% of an excess between a borrower’s outstanding balance and the related property value.
WIRES Planned Releases
The planned timings of and reasons for WIRES releases as at the date of this newsletter, are shown below. These timings are subject to alteration and will be influenced by changes communicated by regulators.
|c. 8th March 2023||
This regulatory update is Whistlebrook’s understanding of the position as at 26th January 2023.