Sam Woods, PRA Deputy Governor, has written to the Rt. Hon Mel Stride MP to outline his thoughts on possible enhancements to the conditions for assessing a proposed change in control (Conditions) under FSMA. Mr Woods commented that the Conditions (amended in 2009) do allow the regulators to intervene where they identify material concerns but that a small modification would enable a more rigorous review of acquisitions.
At present, the regulator may only object to a complete change in control application if there are reasonable grounds for doing so based on six criteria. The PRA considers these criteria are sensible and do not need to be changed from a prudential supervisory perspective. However, the PRA is raising with Treasury the possibility of reverting to the approach that existed before the 2009 amendments, i.e. allowing the regulator to object unless it is satisfied it is appropriate for an acquisition to take place in the light of the relevant criteria. Mr Woods says this would strengthen the hand of the regulator where the position is unclear and be conducive in practice to an even more robust approach to the review of acquisitions.