Victoria Saporta: The Prudential Regulation Authority's (PRA) future approach to policy

Speech by Ms Victoria Saporta, Executive Director for Prudential Policy of the Bank of England, at the City & Financial Global event, London, 27 September 2022.

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

Central bank speech  | 
27 September 2022


The Government's Financial Services and Markets Bill introduces important changes to the PRA's powers and responsibilities. It does so to implement reforms identified by the Future Regulatory Framework for Financial Services Review, or the 'FRF Review'.

The reforms will move financial regulation back to a British style of regulation based on the Financial Services and Markets Act of 2000, which we refer to as 'FSMA'. Most technical rules will be made by regulators accountable to Parliament. This will broaden rule-making powers for the PRA, as requirements which are now in statute will be replaced by new elements of our Rulebook, which we will have the power to change.

The FSM Bill also introduces a new objective. The PRA's primary objectives will remain the safety and soundness of firms and, for insurers, an appropriate degree of protection for policyholders. We will keep our existing secondary objective to facilitate effective competition in markets for financial services. But alongside these we will have a new secondary objective to facilitate, subject to alignment with relevant international standards, the international competitiveness of the UK's economy and its growth in the medium to long term.

We know it is important that we explain what we think these changes will mean for our policy-making. We also want to hear how other people think we should approach our objectives and use new powers. That is why on 8 September we published a discussion paper setting out our vision for the PRA as a strong, accountable, responsive, and accessible rule maker.