UK PRA finalises low impact amendments to PRA rules and policy material: July

The UK Prudential Regulation Authority (PRA) has published policy statement LIAF02/26, finalising a series of amendments to its Rulebook and policy materials that it considers low impact. This follows its April consultation (LIAC01/26).

Following consultation responses on proposals 1 and 3, the PRA is:

• Amending the Groups Part of the PRA Rulebook to clarify that proportional consolidation applies where a participation arises through voting rights, not only share of capital, with related updates to SS15/13 – Groups setting out how firms should determine the proportion to consolidate where voting rights and share of capital differ. Under the PRA Rulebook: CRR firms: Group Instrument 2026, the Annex A rule amendments take effect on 30 July, the Annex B amendments on 1 January 2027, and the SS15/13 from 1 January 2027, although firms may refer to them for guidance in the meantime.
• Amending the Countercyclical Capital Buffer Rates UK Technical Standard to replace cross-references to the Capital Requirements Regulation with references to the PRA Rulebook, including aligning the 'trading book exposures' definition with the Capital Buffers Part of the PRA Rulebook, effective 1 January 2027.

On proposals 2,4 and 5, the PRA has finalised these proposals as consulted on. They cover: (i) consequential amendments to certain PRA rules relating to the Capital Requirements Regulations 2013; (ii) amendment to the frequency of the other systemically important institution (O-SII) designation exercise in statement of policy (SoP)1/16; and (iii) amendments to the definition of firms in scope of the O-SII buffer in SoP1/16 and SoP4/16. For proposal 6, the PRA has made minor amendments to its proposed updates to SoP1/20, which are intended to improve clarity and do not alter the substance of the policy.

The PRA is also making minor corrections without further consultation, including: updating the "netting set" definition in the Glossary Part to correct a cross-reference error, effective 1 January 2027; correcting the General Notification and Regulatory Reporting Parts to confirm that third-country branches are excluded from material third-party notification requirements and that UK branches of overseas banks are included in operational incident reporting requirements, effective 18 March 2027; and correcting the Credit Risk: Standardised Approach and Internal Ratings Based (CRR) Parts and SS10/13, including clarifications to Articles 120(4), 121(2), 121(5) and 151(5) and to the "residential real estate" references in SS10/13, effective 1 January 2027.

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