![]() ![]() Operational impact (£m) (HM Revenue and Customs or other) This measure will have no impact on civil society organisations. Banks are expected to incur a negligible one off cost to become familiar with the change in legislation. It will only affect banking business with liabilities in excess of £20 billion and amendments to the definitions are expected to have a negligible administrative impact. This measure is expected to have a negligible impact on businesses. Impact on business including civil society organisations The measure is not expected to have a direct or disproportionate impact on any of the protected equality groups. ![]() The measure is not expected to impact on family formation, stability or breakdown. Impact on individuals, households and families This measure is not expected to have any significant macroeconomic impacts. The Office for Budget Responsibility will include the impact of this measure in its forecast in Autumn 2016. Summary of impacts Exchequer impact (£m) 2016 to 2017 The amendment will be made by statutory instrument using the power to make regulations within paragraph 81 of schedule 19 to the Finance Act 2011. ![]() The revisions proposed will amend the existing definition of HQLA to from the old BIPRU definitions to the new CRD IV definitions by amending paragraph 70 of schedule 19 to Finance Act 2011. Our current law on HQLA is included in part 8 of schedule 19 to the Finance Act 2011 and within part 4 of the same schedule of the same act for high quality securities. The measure will have effect from 1 October 2016. This matter is being legislated separately to the re-scope due to the timescales involved. Options to deal with the withdrawal of the BIRPU 12 definition were consulted upon as part of the Bank Levy Re-scope consultation in 2015. There is no change to existing policy by updating this definition. The amendment to the definition to high quality securities is required as a consequence of changes to the PRA’s definition of liquid assets. This measure updates the definitions used to determine which assets qualify as HQLA and high quality securities within the Bank Levy legislation to reflect regulatory changes affecting bank and building societies. This will maintain the existing policy for giving relief for assets types that the PRA mandates banks must hold. This amendment will allow relief for all Level 1 type assets. Banks and building societies have been using these new CRD IV definitions from 1 October 2015, and from 1 October 2016 they will no longer use the old BIPRU 12 definitions. The PRA’s ‘Prudential Sourcebook for Banks, Building Societies and Investment Firms ( BIPRU) 12’ definition was changed in October 2015 to introduce new Basel III liquidity coverage ratios for banks known as Capital Requirements Directive IV ( CRD IV). In order to align with regulatory principles to support banks and building societies to hold assets qualifying for the purpose of regulatory liquidity buffers, the current legislation provides relief for high quality liquid assets ( HQLA) as defined by the Prudential Regulation Authorities’ ( PRA) handbook. ![]() UK banks, banking groups and building societies, foreign banking groups operating in the UK through permanent establishments or subsidiaries and UK banks and banking sub groups in non-banking groups. ![]()
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