Parliamentary Commission on Banking Standards and Pillar 2: Difference between pages

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(PCBS).
''Banking - regulation.''


== Terms of reference ==
(P2).


The Parliamentary Commission on Banking Standards was established by the UK Parliament to:
Pillar 2 is the aspect of banking supervision which addresses firm-wide governance and risk management, among other matters.


'''A.''' Consider and report on:
Additional capital requirements may be imposed by bank supervisors under Pillar 2, depending on their evaluation of banks' internal assessments of their risks and capital requirements.


# Professional standards and culture in the UK banking sector, taking account of regulatory and competition investigations into the LIBOR rate-setting scandal.
# Lessons to be learned about:
## Corporate governance.
## Transparency.
## Conflicts of interest.
## Their implications for regulation and for UK Government policy.


'''B.''' Make recommendations for legislative and other action.
=====UK Pillar 2 supervisory reviews=====
The UK supervisor is the Prudential Regulatory Authority (PRA).


There are two main areas that the PRA considers when conducting a Pillar 2 review:


(i) Risks to the firm which are either not captured, or not fully captured, under Pillar 1 capital requirements, referred to as Pillar 2A; and


== Final report ==
(ii) Risks to which the firm may become exposed over a forward-looking planning horizon - e.g. due to external stresses - referred to as Pillar 2B.


The Commission's 2013 report is designed to address:


# Making the individual responsibility of senior bankers a reality.
=====IRRBB=====
# Reinforcing each bank's own responsibility for its own soundness and the maintenance of its standards.
Most regulators treat Interest Rate Risk in the Banking Book (IRRBB) as a Pillar 2 risk.
# Creating better functioning and more diverse banking markets.
# Reinforcing regulators' responsibility to exercise judgement in deploying their powers.
# Specifying the responsibilities of the UK Government.




The Commission's report setting out its conclusions and recommendations can be downloaded here:
== See also ==
[[Media:PCBS report June 2013.pdf|PCBS final report June 2013]].
* [[Bank supervision]]
 
* [[Basel III]]
 
* [[Capital adequacy]]
==External links==
* [[Interest Rate Risk in the Banking Book]]
*[http://www.parliament.uk/bankingstandards UK Parliament: PCBS]
* [[Pillar 1]]
 
* [[Pillar 3]]
[[Category:Regulation_and_Law]]
* [[PRA buffer]]
[[Category:Control_and_Reporting]]
* [[Prudential Regulation Authority]]
[[Category:Policy_and_Objectives]]
* [[SREP]]
[[Category:The_Treasury_Professional]]
* [[Stress]]

Revision as of 13:33, 11 November 2016

Banking - regulation.

(P2).

Pillar 2 is the aspect of banking supervision which addresses firm-wide governance and risk management, among other matters.

Additional capital requirements may be imposed by bank supervisors under Pillar 2, depending on their evaluation of banks' internal assessments of their risks and capital requirements.


UK Pillar 2 supervisory reviews

The UK supervisor is the Prudential Regulatory Authority (PRA).

There are two main areas that the PRA considers when conducting a Pillar 2 review:

(i) Risks to the firm which are either not captured, or not fully captured, under Pillar 1 capital requirements, referred to as Pillar 2A; and

(ii) Risks to which the firm may become exposed over a forward-looking planning horizon - e.g. due to external stresses - referred to as Pillar 2B.


IRRBB

Most regulators treat Interest Rate Risk in the Banking Book (IRRBB) as a Pillar 2 risk.


See also

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