Article 4 Macro-prudential measures

United Kingdom

(1)

For the purposes of section 9H(1) and 9L of the Bank of England Act 1998, the following measures (and any measures falling within a listed measure) are prescribed in relation to the PRA—

(a)

a measure to require UK banks F1, or their holding companies, and UK investment firms F2, or their holding companies, to hold sufficient Tier 1 capital to satisfy a minimum leverage ratio specified by the Financial Policy Committee;

(b)

a measure to secure that F3relevant O-SIIs ordinarily hold sufficient Tier 1 capital to satisfy an F4O-SII additional leverage ratio specified by the Financial Policy Committee;

(c)

a measure to secure that G-SIIs ordinarily hold sufficient Tier 1 capital to satisfy a G-SII additional leverage ratio specified by the Financial Policy Committee;

(d)

a measure to secure that UK banks , or their holding companies, and UK investment firms , or their holding companies, ordinarily hold sufficient Tier 1 capital to satisfy a countercyclical leverage ratio buffer specified by the Financial Policy Committee.

(2)

The Financial Policy Committee may also specify a minimum proportion of Common Equity Tier 1 capital that shall be held in relation to a measure specified in paragraph (1).

(3)

The Financial Policy Committee may include in a direction relating to the countercyclical leverage ratio buffer a method of calculating the countercyclical leverage ratio buffer by reference to the prevailing countercyclical capital buffer rates.

F5(4)

The Financial Policy Committee may include, in a direction relating to any of the measures specified in paragraph (1), specifications as to how the total exposure measure is to be determined for the purposes of that measure.

Annotations

Textual amendments

F1: Words in art. 4(1) inserted (21.7.2021) by The Bank of England Act 1998 (Macro-prudential Measures) (Amendment) Order 2021 (S.I. 2021/869), arts. 1(2), 4(5)
F2: Words in art. 4(1) inserted (21.7.2021) by The Bank of England Act 1998 (Macro-prudential Measures) (Amendment) Order 2021 (S.I. 2021/869), arts. 1(2), 4(6)
F3: Words in art. 4(1)(b) substituted (29.12.2020) by The Financial Holding Companies (Approval etc.) and Capital Requirements (Capital Buffers and Macro-prudential Measures) (Amendment) (EU Exit) Regulations 2020 (S.I. 2020/1406), regs. 1(4), 8(3)(a)
F4: Word in art. 4(1)(b) substituted (29.12.2020) by The Financial Holding Companies (Approval etc.) and Capital Requirements (Capital Buffers and Macro-prudential Measures) (Amendment) (EU Exit) Regulations 2020 (S.I. 2020/1406), regs. 1(4), 8(3)(b)
F5: Art. 4(4) inserted (21.7.2021) by The Bank of England Act 1998 (Macro-prudential Measures) (Amendment) Order 2021 (S.I. 2021/869), arts. 1(2), 4(7)