Victoria Saporta: Building strong and simple - the first step

Speech by Ms Victoria Saporta, Executive Director for Prudential Policy of the Bank of England, at the Bank of England virtual webinar, 29 April 2021.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Last year, I set out my views on the ideal framework of post-Brexit prudential regulation in the UK. I outlined the key features that this prudential framework should exhibit. That it should be legitimate and democratically accountable, that it should have time-consistency embedded within it, and that it should adapt to changing circumstances whilst upholding prudential standards.

I concluded that the framework which best embodies these features is one where policy is made by an independent regulatory body, with a clear mandate, and robust accountability mechanisms, in particular to Parliament. I am therefore pleased that this was the model consulted on in HMT's Regulatory Framework Review last October.

Of course the legislative process still needs to be completed. But we at the PRA must prepare in anticipation of the enhanced role we are set to play in this post-Brexit world.

I would like to use this speech to sketch a vision for our updated approach to policymaking, before devoting the majority of my time to giving detail on a key upcoming policy initiative – the so-called 'Strong and Simple' framework for small banks and building societies.