FSA: Consultation Paper: Use of non-EEA rules in calculating group capital requirements
March 2011
The FSA has published a consultation paper setting out the FSA's proposals for removing the rules permitting the use of non-EEA regulators' rules in calculating the group capital requirements of a UK banking/investment firm group on a standardised approach.
The FSA proposes to revoke the equivalence rules in BIPRU 8. That is, they propose to delete BIPRU 8.7.35R, 8.7.36G and 8.7.38R from the FSA Handbook.
This will mean that for the purpose of aggregating the capital requirements of a non-EEA subsidiary into the consolidated capital requirements of a UK consolidation group, firms will use the FSA rules rather than local (i.e. non-EEA) rules in calculating the capital requirements of that subsidiary.
The proposed Handbook changes are designed to ensure that the group capital requirements of a UK banking/investment firm group, on a standardised approach, are calculated under FSA rules.
The FSA propose that the rule changes come into force on 30 December 2011.