Regulatory Alerts2016-07-20
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A new UK prudential regime for MiFID investment firms
The Financial Conduct Authority proposes the Investment Firm Prudential Regime (IFPR) to replace the current prudential framework for UK firms authorised under the Markets in Financial Instruments Directive (MiFID). The proposals introduce a fixed overheads requirement, activity-based capital requirements known as K-factors, and a basic liquid asset requirement equivalent to at least one third of the fixed overheads requirement. All affected firms must implement an internal capital and risk assessment process to meet the Overall Financial Adequacy Rule, while remuneration requirements are scaled based on firm size. This consultation paper seeks comments on these draft rules by 28 May 2021.
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