Impact tolerance: Difference between revisions
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The maximum impact tolerance level reflects the point at which any further disruption to the important business service could | The maximum impact tolerance level reflects the point at which any further disruption to the important business service could: | ||
:(1) any one or more of the firm’s clients, or | :(1) cause intolerable harm to any one or more of the firm’s clients, or | ||
:(2) pose a risk to the soundness, stability or resilience of the UK financial system, | :(2) pose a risk to the soundness, stability or resilience of the UK financial system, | ||
:(3) the orderly operation of the financial markets. | :(3) or to the orderly operation of the financial markets. | ||
Latest revision as of 12:07, 24 July 2024
Risk management - regulation - supervision - UK Prudential Regulation Authority (PRA) - Financial Conduct Authority (FCA).
The maximum tolerable level of disruption to an important business service, as measured by a length of time - in addition to any other relevant metrics.
The maximum impact tolerance level reflects the point at which any further disruption to the important business service could:
- (1) cause intolerable harm to any one or more of the firm’s clients, or
- (2) pose a risk to the soundness, stability or resilience of the UK financial system,
- (3) or to the orderly operation of the financial markets.
- (Source - Financial Conduct Authority Handbook.)
- Setting impact tolerances - Bank of England - Financial Conduct Authority
- "Firms and FMIs should identify specific metrics for the maximum tolerable level of disruption.
- These should be measures that identify: harm to consumers or market participants; harm to market integrity; threat to policyholder protection; safety and soundness; or financial stability.
- Such metrics could measure the extent of disruption, for example by including the maximum value of disruption, number of transactions, or the number of customers affected.
- All impact tolerances should include the maximum tolerable duration of such disruption, taking into account the criticality of the important business service.
- However, a metric based on time alone may be insufficient."
- Building operational resilience: Impact tolerances for important business services - Bank of England - Financial Conduct Authority.
See also
- Bank of England
- Business impact analysis
- Enterprise risk management
- Financial Conduct Authority (FCA)
- Financial Market Infrastructure (FMI)
- Financial markets
- Firm
- Guide to risk management
- Impact
- Metric
- Operational resilience
- PRA Supervisory Statement 1/21 (SS1/21)
- Prudential Regulation Authority (PRA)
- Regulation
- Resilience
- Risk appetite
- Risk management
- Risk policy
- Risk tolerance
- Supervision
- Sustainability
