CP24/23: Remuneration reforms

Read CP24/23 (PRA CP16/24)[1] 

Why we are consulting

We want to make the dual-regulated firms’ remuneration regime more effective, simple and proportionate in meeting its aim of ensuring accountability for risk taking, while supporting our secondary objective to facilitate the international competitiveness of the UK economy and its growth.

The changes also help ensure appropriate outcomes for consumers and markets.

Who this is for

• Banks
• Building societies
• PRA-designated investment firms

It will also be of interest to

• firms in scope of the FCA’s MIFIDPRU Remuneration Code (SYSC 19G[2])
• solo-regulated investment firms and firms that are members of a group to which the dual-regulated remuneration regime applies on a consolidated basis

Next steps

This consultation has now closed. 

We will publish feedback on responses and issue a Policy Statement once we have reviewed your comments. 

Background

In continuation of the post-Brexit reforms, we, alongside the PRA, want to remove complexities and clarify core aspects of the dual-regulated firms’ remuneration framework. Our aim is to support and maintain the regime’s effectiveness, while supporting the international competitiveness of the UK financial sector and economic growth in the medium to long term.

Our changes remove unnecessary duplication of rules between the regulators, streamline the remuneration regime for firms, and further strengthen the reputation of the UK banking sector.

Our proposals complement changes introduced in 2023. Specifically, the removal of the bonus cap and enhancements to proportionality for small dual-regulated firms.