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

CP13/6
CRD IV for Investment Firms
CRR
article
FCA
Handbook
reference –
if existing
discretion
Area of national discretion
Does the
FCA intend
to exercise
the relevant
discretion from
1 January 2014?
298(4) FCA may allow a firm to choose either original or
residual maturity for the purpose of calculating the
effects of recognition of netting as risk reduction in
relation to interest rate contracts.
Yes
312(1) BIPRU
6.4.1R(1),
BIPRU
6.4.16G
FCA may give a direction to a firm to allow it to use the
‘alternative relevant indicator’ for operational risk for
business lines ‘retail banking’ and ‘commercial banking’
No
312(2)
and
322
BIPRU
6.5.2G,
BIPRU
6.5.3G,
BIPRU
6.5.4G,
BIPRU
6.5.5R,
BIPRU
6.5.6R,
BIPRU
6.5.5AG,
BIPRU
6.5.8G to
6.5.11G
FCA may give a direction to a firm to allow it to use the
AMA for operational risk when certain conditions are met.
Yes
313 BIPRU
6.2.5R,
BIRPU
6.2.6G,
BIPRU
6.2.7R,
BIPRU
6.2.8G
Firms will not be able to revert back to using a less
sophisticated approach to calculating their operational
risk capital requirement unless they meet prescribed
conditions and receive permission from the FCA.
Yes
314(1-
5)
BIPRU
6.2.9R,
BIPRU
6.2.10G,
BIPRU
6.2.11R,
BIPRU
6.2.12R,
BIPRU
6.2.13G
Institutions are able to use a combination of approaches
to calculating their operational risk capital requirement
as long as they meet the prescribed conditions and
receive prior permission from the FCA.
Yes
315(3) BIPRU
6.3.4G,
BIPRU
6.3.9G(1),
BIPRU
6.3.9G(2)
This discretion relates to the calculation of the Basic
Indicator Approach for operational risk. A firm may
request to adjust their operational risk calculation as
due to a merger, an acquisition or a disposal of entities
or activities, a simple three year average of the relevant
indicator is not an unbiased calculation. The FCA must
consider such a request, and if approved, inform the
EBA of this decision. Further, the FCA is able to require
the firm to modify its calculation in such circumstances.
Yes
84 July 2013
Financial Conduct Authority