UK Basel 3.1 rules - Large banks will likely welcome final credit risk rules
On 12 September 2024, the PRA published Policy Statement PS 9/24 setting out the final UK rules on credit risk and the output floor to implement the post crisis Basel Committee on Banking Supervision (BCBS) reforms, “Basel 3.1”. The implementation deadline is now 1 January 2026 - a delay of six months from the proposals.
The PRA estimates that the Tier 1 capital requirements of major UK firms will be virtually unchanged by the final rules, with an aggregate increase of less than 1% when the rules are fully phased in. Firms will need to assess the impact for their own business model, portfolio and products as average impacts can be misleading.
The PRA has tailored the final rules to reflect its secondary competitiveness objective and its view of certain risks but, overall, the final rules are materially aligned with the BCBS standards, with less divergence than the EU.
Download this Hot Topic to see our summary of the PRA’s final policy, and what this means for firms.
Contact us
Nigel Willis
Partner, UK Financial Risk Management Leader, PwC United Kingdom
Tel: +44 (0)7843 370460
Peter El Khoury
Head of Banking Prudential Regulation & FS Digital Partner, PwC United Kingdom
Tel: +44 (0)7872 005506
