Based on methodology in statement of policy The PRA's approach to identifying O-SIIs, PRA has designated 15 firms as O-SIIs, there is no change from list issued in 2022.
Barclays Plc; Citigroup Global Markets Limited; Credit Suisse International; Goldman Sachs Group UK Limited; HSBC Holdings Plc; J.P. Morgan Capital Holdings Limited.
Lloyds Banking Group Plc; Merrill Lynch International; Morgan Stanley International Limited; Nationwide Building Society; NatWest Group Plc; Nomura Europe Holdings Plc; Santander UK Group Holdings Plc; Standard Chartered Plc; Virgin Money UK Plc.
Buffer Rates
PRA also issued 2023 O-SII buffer rates for ring-fenced banks, large building societies.
Is required to set these rates by applying UK FPC framework for the O-SII buffer.
In line with updated FPC framework, PRA set O-SII buffer rates based on UK leverage exposure measure (LEM) data as of end-2022 assessed on a sub-consolidated basis for ring-fenced banks (RFBs), and on a consolidated basis for building societies.
PRA set O-SII buffer rates for RFB sub-groups, apply on sub-consolidated basis to all exposures; Lloyds Banking Group RFB sub-group 2.0%; NatWest RFB sub-group 1.5%.
HSBC RFB sub-group 1.0%; Barclays RFB sub-group 1.0%; Santander UK RFB sub-group 1.0%; PRA included a table setting out the RFBs in each RFB sub-group.
For RFBs, if group is not subject to a global systemically important institution (G-SII) buffer or if group has G-SII buffer rate lower than O-SII buffer rate there will be an increase in both the group PRA buffer and the leverage ratio group add-on.
In order to ensure sufficient capital to address both global and domestic systemic risks.
PRA also confirmed it set O-SII buffer rate of 1.0% for Nationwide Building Society.
Effectiveness
The O-SII buffer rates set out in PRA's publication will apply from Jan. 1, 2025.
In Nov. 2023, UK PRA issued its 2023 list of UK headquartered G-SIIs, see #192826.
