The ABI says that the PRA’s current proposals are likely to result in a rise in the overall reporting requirements for large firms already dealing with the “frequent and onerous” reporting requirements introduced by Solvency II, says the insurers’ trade body.
The ABI says this in spite of industry expectations of a reduction in reporting costs suggested, says the ABI, during the recently Treasury Committee inquiry into Solvency II, when Sam Woods, CEO of the PRA, committed to reviewing reporting requirements to see if the reporting burden and costs for firms could be reduced.
Steven Findlay, assistant director and head of Prudential Regulation at the ABI, said: “The pillar 3 reporting burden on firms is already excessive, typically four to eight times greater than under the previous regime. This was explored recently by the Treasury Committee during their inquiry into Solvency II and so it is disappointing to see the PRA layering on top yet more regular reporting requirements.
“It is understandable that the PRA wishes to better understand the market sensitivities of firms. However any increase in requirements needs accompanying by a bigger decrease in other reporting requirements in order for the load to be lightened.”
The PRA has stated that the new regular reporting requirements it has proposed will lead to a reducing in ad hoc reporting. However, the PRA’s draft Supervisory Statement still leaves the door open for ad hoc reporting, the ABI warns. It indicates that firms will still be expected to submit ad hoc information whenever the PRA requests it, such as during periods of extraordinary market conditions.
In its submission to the PRA, the ABI has proposed the PRA monitors and reports on the number of ad hoc requests to firms to assess whether the reduction in ad hoc reporting has indeed been happening, and if it more than offsets any addition to regular reporting, which is the intention of these proposals.