LONDON (Reuters) – Britain’s Prudential Regulation Authority on Wednesday proposed reforms to rules governing recognised exchanges, with a view to ensuring the continued safety and soundness of trading and clearing activities in the UK.
The PRA proposals mainly address the conditions under which an overseas exchange can be defined as a recognised exchange in the UK, and form part of the regulator’s broader aims to boost the global competitiveness of Britain’s financial sector by replicating some rules in place internationally and increasing asset eligibility.
It has also proposed that firms should undertake their own exchange and asset liquidity risk assessments, which could then be evaluated by the regulator via post-implementation thematic reviews.
The PRA has invited feedback on its proposals from firms that use, or accept, assets traded on non-UK exchanges for credit risk mitigation, liquidity risk, and market and counterparty credit risk purposes.
(Reporting by Muvija M and Sinead Cruise; Editing by Amanda Cooper)
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