The Prudential Regulation Authority (PRA) has assumed powers to impose external members of staff on asset managers, banks and insurers, and to cap asset growth in companies it is concerned about.
In a statement released yesterday setting out how it will regulate failings in the ‘culture’ of regulated businesses and enforce additional oversight on boards it does not believe are acting independently.
It added that it had already entered into an agreement with an unspecified business which would limit its asset growth to a set percentage over a 12-month period.
‘While the PRA looks to firms to co-operate with it in resolving supervisory issues, it will not hesitate to use formal powers where it considers them to be an appropriate means of achieving desired supervisory outcomes,’ it said in a statement.
While primarily aimed at the banking sector following a series of rate-setting scandals, the powers are also applicable to asset managers and insurers which fall under the macro-prudential regime.
The powers were laid out in the PRA’s Fundamental Rules, replacing the previous Principles for Business.