PRA and FSCS update MoU

The PRA and FSCS have published an updated Memorandum of Understanding which replaces the existing version implemented in 2019.

The MoU outlines the framework agreed by the PRA and FSCS on how they will work together in carrying on their respective responsibilities. It has been updated to take account of Brexit (to remove references to EBA etc.), and to include:

• reference to the PRA’s secondary objective to facilitate effective competition in the markets for services provided by PRA-authorised firms;
• commitment by FSCS to establish a regular programme of stress tests to verify whether its operational and funding capabilities are sufficient to ensure protection in various complex scenarios and in times of increased pressure; and
• where appropriate, commitment by FSCS to enter into cooperation agreements with depositor and policyholder schemes in other jurisdictions to facilitate meeting its duties under FSMA and the PRA Rulebook.