PRA - Supervisory priorities for 2023
Prudential Regulation Authority (PRA)On a yearly basis, the UK´s Prudential Regulation Authority (PRA) publishes its supervisory expectations on the risks facing UK deposit-taking institutions, international banks and insurers operating in the UK.
PRA - Supervisory priorities for 2023
Executive summary
The PRA has set out its 2023 priorities with implications for deposit-takers, international banks and insurers active in the UK. The PRA's aim is to try to anticipate these risks by setting a number of supervisory priorities for firms.
Main content
The PRA has set two priorities for all three groups of firms: on the one hand, alignment with the supervisory expectations for outsourcing and third-party risk management and on the other, adopting a proactive approach to addressing climate change risks and demonstrating their capabilities in meeting supervisory expectations.
The PRA has also established specific priorities by type of firm. In this respect, the thematic reviews of the control frameworks of deposit takers and international banks to ensure their financial resilience should be highlighted due to their potential demanding nature.
Other priority supervisory activities for deposit takers are:
- Assessment of their credit risk management capability
- Quality of their regulatory reporting
- Assessment of their degree of adherence to Model Risk Management principles
Other priority supervisory activities for international banks are:
- Assessment of their capital and liquidity positions and risk management practices
- Quality of their regulatory reporting
Other priority supervisory activities for insurers are:
- Assessment of their ability to perform stress tests under adverse credit scenarios
- Assessment of their ability to manage credit risk and the validity of their internal models
- Assessment of their level of compliance with the Prudent Person Principle and of the reinsurer’s resilience capacity over the whole duration of the exposures
Download the technical note Supervisory priorities for 2023 (PRA).