On 31 July 2020, the PRA published a Consultation Paper (CP12/20) on its proposed approach to implementing the CRD V Directive ((EU) 2019/878) in the UK. This will be relevant to banks, building societies and PRA-designated investment firms.
The PRA's focus in CP 12/20 is on the following areas:
- Pillar 2 supervisory requirements and guidance
- Remuneration
- Intermediate parent undertakings (IPUs)
- Governance
- Third-country branch reporting.
The PRA intends to publish a second consultation in autumn 2020 on those components of CRD V not covered by the consultation (in particular those requiring legislative change, which are under consideration by HM Treasury), and amendments to the Capital Requirements Regulation under CRR II (Regulation (EU) 2019/876), which will apply from Monday 28 December 2020.
As much of CRD V is required to be transposed by EU Member States by 28 December 2020, it will be transposed into UK law by that date in line with the UK's approach to implementing EU legislation under the EU Withdrawal Act 2018. This will be subject to some limited exceptions (including for those provisions of CRD V that take effect at a later date).
The PRA also intends to apply some additional modifications for UK institutions with effect from the end of the Brexit implementation period on 31 December 2020.
The consultation period for CP12/20 closes on 30 September 2020.
Disclaimer
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