Capital Requirements Directive (CRD)
If your firm is subject to the capital requirements directive (CRD), these pages give you more useful information.
About 500 small firms must comply with the CRD. This requires firms to assess the amount of internal capital or other mitigants they consider adequate to cover all of the risks to which they are, or likely to be, exposed.
The new regime is referred to as "pillar 2", which is one of three supervisory pillars Collectively pillars 1, 2 and 3 form an overall framework for prudential supervision of banks, building societies and investment firms.
Under "pillar 2" firms are required to carry out an assessment called the internal capital adequacy assessment process (ICAAP)
We expect the majority of firms will complete an ICAAP, and implement the results of the process, in the fourth quarter of 2007, ahead of the deadline of 1 January 2008. A number of firms have though completed the process, and we have met with some of them to discuss their experiences.
Key dates
1 January 2008
Deadline date for implementing Pillar 2 and the deadline for completion of your ICAAP, if you intend implementing on the deadline date.
If you intend implementing Pillar 2, before the deadline date then you must have completed the ICAAP before the intended implementation date.