PRA has clarified its approach to published EBA Guidelines and EU RTS in relation to credit risk following the end of the Brexit transition period. PRA had thought that the RTS on economic downturn would have been made before the end of the transition period, and therefore would have formed part of EU retained law, but this did not happen. PRA is now proposing to consult on bringing the requirements within UK regulation. PRA’s statement also lists the other relevant guidelines, and its expectations on firms. In principle, firms have until 1 January 2022 to comply, and should continue to submit model change applications to supervisors.
