Mon 03 Sep 2018

Five things you might not know about the Prudential Regulation Authority

Prudential Regulation Authority (PRA)

  1. The Prudential Regulation Authority (PRA), is subsidiary of the Bank of England. It was set up under the Financial Services Act 2012 in response to the financial crisis.
  2. The PRA is a prudential and supervisory regulator. It is responsible for the prudential regulation and supervision of approximately 1,500 banks, building, societies, credit unions, insurers and major investment firms. It also supervises financial market infrastructure like payment systems and clearing houses. 
  3. The objectives of the PRA are to promote the safety and soundness of the firms they regulate and to contribute to securing an appropriate degree of protection for insurance policy holders. They also have a competition objective to facilitate effective competition between firms.
  4. The PRA are not solely focused on current risks. They are forward looking. They look at risks that could plausibly arise and try to intervene at an early stage. The PRA has recently collaborated with the Financial Conduct Authority and the Bank of England in issuing a Discussion Paper on building the UK financial sector's operational resilience.
  5. The PRA co-operates with the Bank of England, the Financial Conduct Authority and the Payment Systems Regulator through a Memorandum of Understanding. Under the Financial Services (Banking Reform) Act 2013 the regulators have a duty to ensure co-ordinated exercise of functions. They must also have a Memorandum of Understanding that it is reviewed annually. The latest version was updated in July 2018.

The PRA does not have its own Linkedin or Twitter. The Bank of England shares PRA updates through their social media channels. 

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