PS16/3: Strengthening accountability in banking: Feedback on CP15/22 and CP15/31; final rules on extending the certification regime to wholesale market activities and interim rules on referencing

Published: 04/02/2016     Last Modified: 26/05/2016

In this policy statement we set out final rules for the new accountability framework for individuals working in banks, building societies and credit unions who perform certain wholesale market activities.

Why are we issuing this policy statement?

This policy statement sets out final rules for the new accountability framework, which we consulted on in July 2015.

We also provide initial feedback on CP15/31: Strengthening accountability in banking and insurance: regulatory references (October 2015) as well as our final rules on an interim regime for referencing, pending a permanent set of rules for references, including transitional arrangements, which we aim to publish in the summer.

As well as ensuring that, in future, senior managers can be held accountable for any misconduct that falls within their area of responsibility, our regime aims to hold individuals working at all levels in banks and other relevant firms to appropriate standards of conduct.

PS16/3: Strengthening accountability in banking: Feedback on CP15/22 (July 2015) and CP15/31 (October 2015); final rules on extending the certification regime to wholesale market activities and interim rules on referencing [PDF]

Who will this affect?

Our feedback on CP15/21 and final rules will be of primary interest to banks, building societies, credit unions and PRA-designated investment firms. The referencing requirements will also be of interest to all firms, and in particular Solvency II and large non-directive insurers.

Both UK relevant authorised persons (RAPs) and foreign branches should consider this in conjunction with our other publications on the accountability regime.

This policy statement will primarily be of interest to firms. Consumers may be interested in how individual accountability is being enhanced within relevant firms, or how staff that they interact with will be required to comply with the conduct rules. More generally, the changes in this policy statement may be thought of as part of a broader initiative to improve the culture and governance of banks and other relevant firms, which should bring significant benefits to consumers.

What are the next steps?

If your firm is affected by the Senior Managers and Certification Regime, you will need to ensure that you are ready for when it comes into force on 7 March 2016. 

Summary of key dates

  • Firms are required to submit grandfathering notifications for existing approved persons who will be performing senior management functions under the new regime by 8 February 2016
  • Firms must identify individuals subject to the certification regime and train them in respect of the conduct rules, which will apply when the new regime begins on 7 March 2016
  • A firm has until 7 September 2016 to identify staff under the new client-dealing significant harm function (SHF) or the new algorithmic trading SHF and to train them in respect of the conduct rules, which will also apply from 7 September 2016
  • Firms will have one year, until 7 March 2017, to prepare for the wider application of the conduct rules to other staff
  • Firms' deadline for issuing certificates for individuals under the certification regime is 7 March 2017

Find out more

CP15/31: Strengthening accountability in banking and insurance: regulatory references 

CP15/22: Strengthening accountability in banking: Final rules and consultation on extending the certification regime to wholesale market activities

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