The Bank of England (BoE), Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) have released a joint proposal seeking to improve the resilience of financial services in the UK.
The authorities aim to reduce the responsibilities placed on individual firms and FMI entities around operational resilience and third-party risk management through direct regulatory oversight of critical third parties.
In doing so, third parties will be able to deliver services that strengthen operational resilience and encourage innovation in a way that reduces potential stability risks.
The proposal follows the BoE’s recent Financial Stability Report, which noted geopolitical tensions, persistent inflation and uncertainty around inflation rates as potential risks to UK economic growth.
Henry Balani, global head of industry and regulatory affairs at Encompass Corporation, says: “Collaboration between regulators, the Government and industry is essential to developing and strengthening the regulatory framework and how organisations across financial services respond, so it's encouraging to see the Bank of England, PRA and FCA working closely to increase the resilience of the sector, while recognising the importance of supporting innovation."
