International & EU

Wherever possible, we accept group applications for advanced approaches. Firms wishing to make a group application should indicate their intention to us as soon as possible, so that we can coordinate our approach with our regulatory colleagues in other jurisdictions.

Within the EEA, we work within the guidelines being developed by the Committee of European Banking Supervisors (CEBS) for home-host relationships. This involves cooperation with the host supervisors for a group, in particular where subsidiaries in host countries are considered significant or systemically important for the host.

We are working on the assumption that EEA groups submit a single application to their home supervisor.

  • Where we are home supervisor, we take the lead role in communicating with host supervisors on a group’s implementation plans. This collaboration between supervisors is particularly important within the EEA, where Article 129 of the Directive requires that the group of supervisors decide on a formal IRB or AMA application within six months. We will do our best, in working with our fellow supervisors, to ensure that consensus decisions are reached within the six-month period. If no decision is reached in that timeframe, the decision falls to the home supervisor.
  • We have held colleges of supervisors for some of our firms and have developed processes aimed at being as inclusive as possible of all significant regulatory counterparts, both EEA and non-EEA. We intend to continue in this way in the future.
  • Where we are host supervisor for an EEA subsidiary, we rely on the home supervisor to take the lead and to communicate with host supervisors. The application pack should be submitted to the home EEA regulator, not the FSA. We will then liaise with the home regulator. Where we judge the subsidiary to be significant, we will flag this to the home regulator at an early stage and will expect to play a greater part in the approvals process. If we require information from the firm or the parent (as a result of our responsibility for the capital requirements of subsidiaries on a sub-consolidated basis) we will continue with routine supervision, making information requests as necessary following liaison with the home regulator.
  • For non-EEA countries, we are working with our regulatory counterparts outside the EEA to understand how they are implementing the Basel Framework (as opposed to EEA colleagues who are implementing the Capital Requirements Directive). We look to identify any mismatches between our approach and theirs, and to resolve any timetabling or other differences. Where possible, we do our best to smooth the approvals process and make it as seamless as possible, taking into account concerns of other regulators, as well as our own. For firms where we are the consolidating supervisor within Europe, we take a collaborative approach as set out in the Basel Committee's 'High-level principles for the cross-border implementation of the New Accord'. We will avoid being overly burdensome on firms and aim not to duplicate the work of other regulators.

As set out in our paper CP05/3, we encourage firms to talk to their usual supervisory contact both at the FSA and their host regulator (where that is not the FSA), so that we are aware of their intended approaches and can plan accordingly.