CP13/6 - CRD IV for Investment Firms - Financial Conduct Authority

CP13/6
CRD IV for Investment Firms
3.
Capital Requirements Directive:
Key proposals
Introduction
3.1 This chapter:
• sets out our proposals in relation to Pillar 2 and capital buffers;
• explains the requirement on recovery and resolution plans;
• describes our proposals on stress testing;
• outlines the key policy changes in the area of remuneration;
• explains the country-by-country disclosure of corporate information requirement; and
• explains our approach to other technical amendments in the Directive.
3.2 The Directive also contains a small number of areas of national discretions which are listed in
Annex 3 including the FCA’s approach towards their application.
Approach to Pillar 2
3.3 The Directive requires a firm to assess and to maintain on an on-going basis the amounts, types
and distribution of internal capital that it considers adequate to cover the nature and level of
the risks to which it is or might be exposed. The FCA is then required to review and evaluate
this assessment by the firm. If necessary, additional own funds may be needed on top of the
minimum level of own funds set by the CRR. Together, these are known as ‘Pillar 2’.
3.4 The following mapping of the key provisions shows that Pillar 2 has remained largely the same
as the current CRD:
20 July 2013
Financial Conduct Authority