Waivers: Intra-group liquidity modifications - non-ILAS BIPRU firms

Find out about non-ILAS intra-group liquidity modifications and how non-ILAS firms should apply for them.

IFPR

Before considering the information on this page, please note that on 1 January 2022 a new prudential regime for UK investment firms authorised under MIFID (the Investment Firm Prudential Regime (IFPR)) will come into force.

This means: 

  • the majority of existing waivers and modifications to prudential rules in the FCA handbook will no longer apply
  • the majority of existing CRR permissions will no longer apply to FCA investment firms
  • the new rules contain transitional provisions that give some existing waivers and permissions status under the new regime − firms should consider the transitional provisions in the IFPR rules for more details
  • firms will need to consider applying for permissions, or rule waivers and modifications, of rules in the new sourcebook (MIFIDPRU)

Find out more about IFPR.

Non-ILAS intra-group liquidity modifications

A non-ILAS Intra-Group Liquidity Modification is our process for granting and maintaining modifications of the self-sufficiency requirement for UK non-ILAS firms. Such a modification can result in permission being granted to a non-ILAS firm to place reliance on its parent entity in order to satisfy the overall liquidity adequacy rule of BIPRU 12.2.1R.

If your firm is relationship-managed, please contact your FCA supervisor about the appropriateness of your application before you apply.

What to include on the application

A firm should apply for a non-ILAS Intra-Group Liquidity Modification if it has assessed its situation and identified that it will need to rely on its parent in order to comply with the overall liquidity adequacy rule.

An application to rely on support from a parent entity must be made by the non-ILAS firm proposing to rely for support on that parent entity.  

What we look for

  1. a complete waiver application form
  2. an irrevocable letter from the firm's parent to the FCA which includes the following unqualified statement "… We will ensure our subsidiary (name of applicant firm) will have sufficient liquidity resources to enable it to meet its obligations under BIPRU 12 as it applies to the firm."
  3. a complete Liquidity Metrics Monitor (LMM) form

    It is important that you complete all parts that are applicable to your firm, and that you do not alter the cells or formatting in any way.

    Guidance on how to complete the LMM can be found in SUP 16 Annex 25G under instructions for FSA 047/048 (from page 225).

    Please note we are unable to tell you how to complete the LMM. If you require any assistance, please seek external advice.

  4. A description of the Defined Liquidity Group (DLG) structure and details of how the liquidity is managed.

The information requested above is not an exhaustive list. You may be asked to provide further clarifications and information throughout the application process.

Apply for this modification

Please apply for non-ILAS Intra-Group Liquidity Modifications using the normal FCA modification application procedures and submit your application to the [email protected].

Apply to renew an existing non-ILAS Intra-Group Liquidity Modification

Firms with existing non-ILAS Intra-Group Liquidity Modification will be required to submit a new waiver application no later than 2 months before the expiry date of their existing modification. This application should include all of the details outlined above.

NB: Failure to submit a renewal application in a timely manner may result in the expiry of the existing direction and the requirement to comply with the unmodified rules, before we are able to determine the decision for the renewal application. 

Page updates

27/07/2021: Information added Investment Firms Prudential Regime (IFPR)