Brexit workload forcing PRA to put work “on the back burner”

Regulator poring over contingency plans of 400 insurers and other financial businesses

Brexit workload forcing PRA to put work “on the back burner”

Insurance News

By Terry Gangcuangco

“So much work, so little time.” That’s pretty much what’s going on over at the offices of the Bank of England’s Prudential Regulation Authority (PRA).

Last week we told you about that letter from the new chairperson of the Treasury Select Committee asking the PRA about the Brexit plans of hundreds of financial companies. There are over 400 of those, and the PRA expects it would have to regulate more entities when Britain leaves the European Union.

In response to Nicky Morgan, PRA chief executive Sam Woods wrote, as reported by The Times: “The authorisation, and then the ongoing supervision, of a significant number of additional firms is likely to place a material extra burden on the PRA’s resources.”

According to Woods, the PRA was examining each of the contingency plans submitted by banks, insurers, and fund managers – with the whole Brexit task being the top priority for the regulator.

“It is incumbent on us to manage this burden but we may have to make some difficult prioritisation decisions in order to accommodate it,” he said.

Complicating matters is the restructuring going on in companies who want to minimise the impact of Brexit. According to Woods, this would make such firms more complex and difficult to supervise because of strong UK-EU interconnections.

Woods said: “We will need to ensure that these structures do not impede supervisability or resolvability.”

Related stories:
BoE told to share insurers’ Brexit plans

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