The PRA is consulting on removing the requirement for insurers to need permission to classify equity accounted subordinated instruments into tiers of own funds. This was a requirement carried over from Solvency II. At the time the requirements moved into the PRA rulebook, the PRA noted it would in time look at making targeted changes. It feels that making this change would reduce burdens on both firms and the regulator.
The PRA is also taking the opportunity to:
- address some other inconsistencies that it already knew about;
- clarify its expectations around the sequencing of tender offers run concurrently with new issuances when refinancing own funds items; and
- restate EIOPA guidelines on classification of own funds and ancillary own funds into PRA supervisory statements.
Consultation closes on 24 April.