PRA’s Woods: ending capital deductions for IT is ‘dubious’

Regulator signals potential divergence between UK and EU capital rules after Brexit transition

Sam Woods
Sam Woods: questioned how EU deviating from Basel rules would affect UK’s assessment of EU as equivalent
Bank of England

The head of UK prudential regulation has labelled a European Union rule change that allows banks to stop deducting the value of software from their capital as “highly dubious”. The stance could result in potential divergence between EU and UK capital rules once the post-Brexit transition period comes to an end – potentially as early as January 2021.

In May 2019, the EU passed a series of revisions to its bank capital laws, most of which will take effect in June 2021. Among those revisions

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