We have today published the final report on our multi-firm review into firms’ progress in implementing the internal capital adequacy and risk assessment (ICARA) process and reporting requirements under the Investment Firms Prudential Regime (IFPR).
This final report[1] must be read together with the report on our initial observations[2] published in February 2023.
The IFPR aims to streamline and simplify the prudential requirements for the 3,500 MiFID investment firms that are prudentially regulated.
Our review highlights that most firms reviewed engaged well and showed that they were able to make the transition to the new regulations. However, there were areas for improvement. These include improvements around group ICARA processes, internal intervention points, wind-down assessments, liquidity assessments, operational risk capital assessments and regulatory data submissions.
Firms must act now to consider our findings and assure themselves that they are meeting our rules and are mitigating harm from their operations.
The multi-firm review aims to assist firms in understanding and meeting the requirements and enhancing their processes. It supports our commitment within our 3-year strategy to reduce and prevent serious harm and to reduce harm in firm failure.