Pillar 2 and Resolution Authority: Difference between pages

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1. ''Banking - regulation.''
<i>Bank resolution. </i>


(P2).
(RA).


Pillar 2 is the aspect of banking supervision which addresses firm-wide governance and risk management, among other matters.
1.  


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.
An agency of the State, having powers that affect property rights, charged with overseeing the application of the appropriate resolution regime to a failing financial firm.




'''''UK Pillar 2 supervisory reviews'''''
2. ''UK''.


The UK supervisor is the Prudential Regulatory Authority (PRA).
The body with these responsibilities and powers in the UK.


It is part of the Bank of England.


There are two main areas that the PRA considers when conducting a Pillar 2 review:
It has resolved the former Dunfermline Building Society (2009) and Southsea Mortgage and Investment Company (2011).


(i) Risks to the firm which are either not captured at all, or not adequately 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.
3.  


The US bank resolution regime is overseen by the Federal Reserve.


The assessment will generally include an Internal Capital Adequacy Assessment Process (ICAAP) and Supervisory Review and Evaluation Process (SREP).
The potential resolution of global banks requires co-operation between the respective national resolution authorities.




'''''IRRBB'''''
== See also ==
 
* [[Bailin]]
Most regulators worldwide treat Interest Rate Risk in the Banking Book (IRRBB) as a Pillar 2 risk.
* [[Bank of England]]
* [[Bank supervision]]
* [[Living will]]
* [[OLA]]
* [[Purchase and Assumption]]
* [[Resolution]]
* [[South Sea Bubble]]




2.  ''Tax - profit shifting - Global Minimum Tax - Organisation for Economic Co-operation and Development (OECD).''
== External links ==


Pillar 2 of the OECD's tax reforms agreed in 2021 provides detailed rules to implement a global minimum tax rate of 15% on large multinational enterprises.
[https://www.bankofengland.co.uk/financial-stability/resolution UK Resolution Authority]


[https://www.bankofengland.co.uk/financial-stability/resolution Dunfermline BS sold to Nationwide]


:<span style="color:#4B0082">'''''Most tax territories expected to implement Pillar 2'''''</span>
[https://www.bankofengland.co.uk/financial-stability/resolution Southsea's modified insolvency]
 
:"Pillar 2 will require calculation of specific effective tax rates by territory: where this is below 15%, a top-up tax will arise.  
 
:Where a territory does not collect this tax (for example, if it does not implement the rules), it is collected by other territories in which the group operates.  
 
:Therefore, most territories are expected to implement Pillar 2, because the alternative is to give away tax revenues to others."
 
:''Graham Robinson, international tax and treasury partner PwC & Iain McDonald international tax and treasury director PwC - The Treasurer, Issue 4 2022 - December 2022, p40.''
 
 
== See also ==
 
* [[Bank supervision]]
* [[Base erosion and profit shifting]]  (BEPS)
* [[Basel III]]
* [[Capital adequacy]]
* [[Corporation Tax]]
* [[Domestic Minimum Tax]]
* [[Effective tax rate]]  (ETR)
* [[European Union]]
* [[Financial reporting]]
* [[Global Anti-Base Erosion Rules]]  (GloBE]
* [[Gross domestic product]]  (GDP)
* [[Group]]
* [[G7]]
* [[Holdouts]]
* [[Income Inclusion Rule]]  (IIR)
* [[Income Tax]]
* [[Interest Rate Risk in the Banking Book]]
* [[Internal Capital Adequacy Assessment Process]]
* [[Multinational corporation/company]]
* [[Nexus rule]]
* [[Organisation for Economic Co-operation and Development]] (OECD)
* [[Parent company]]
* [[Pillar 1]]
* [[Pillar 3]]
* [[PRA buffer]]
* [[Profit shifting]]
* [[Prudential Regulation Authority]]  (PRA)
* [[Regime]]
* [[Risk management]]
* [[Sister company]]
* [[Stress]]
* [[Subject To Tax Rule]]  (STTR)
* [[Supervisory Review and Evaluation Process]]  (SERP)
* [[Tax ]]
* [[Tax avoidance]]
* [[Tax compliance]]
* [[Tax evasion]]
* [[Tax haven]]
* [[Tax rate]]
* [[Top-up tax]]
* [[Transfer pricing]]
* [[Undertaxed Payments Rule]] (UTPR)
 


==External link==
[https://ec.europa.eu/info/business-economy-euro/banking-and-finance/financial-supervision-and-risk-management/managing-risks-banks-and-financial-institutions/bank-recovery-and-resolution_en EU bank recovery and resolution framework]
*[https://www.oecd.org/tax/beps/tax-challenges-arising-from-the-digitalisation-of-the-economy-global-anti-base-erosion-model-rules-pillar-two.htm OECD - Tax Challenges Arising from the Digitalisation of the Economy – Global Anti-Base Erosion Model Rules (Pillar Two) - Commentary]


[[Category:Accounting,_tax_and_regulation]]
[https://www.federalreserve.gov/supervisionreg/resolution-plans.htm Federal Reserve: bank's Living Wills]

Revision as of 11:03, 16 May 2020

Bank resolution.

(RA).

1.

An agency of the State, having powers that affect property rights, charged with overseeing the application of the appropriate resolution regime to a failing financial firm.


2. UK.

The body with these responsibilities and powers in the UK.

It is part of the Bank of England.

It has resolved the former Dunfermline Building Society (2009) and Southsea Mortgage and Investment Company (2011).


3.

The US bank resolution regime is overseen by the Federal Reserve.

The potential resolution of global banks requires co-operation between the respective national resolution authorities.


See also


External links

UK Resolution Authority

Dunfermline BS sold to Nationwide

Southsea's modified insolvency

EU bank recovery and resolution framework

Federal Reserve: bank's Living Wills

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