The Point
In this edition, we discuss latest developments in the UK and EU banking and investment regulation. These include recent announcement from the HM Treasury of Leeds Reforms which represent the most comprehensive overhaul of the UK financial system in over a decade, key papers from the Bank of England on fundamental rules for Financial Market Infrastructures and the banking resolution regime and from the Prudential Regulation Authority on implementation of Basel 3.1. Our edition also features key EU publications on recent technical standards published by the European Banking Authority on crypto exposure values under CRR III.
Leeds Reforms outline plans for financial services sector
On 15 July, HM Treasury announced Leeds Reforms which represent the most comprehensive overhaul of the UK financial system in over a decade, with the aim of making the UK the leading global destination for financial services by 2035. Key initiatives include unlocking retail investment through FCA-led "Targeted Support" and allowing Long Term Asset Funds within ISAs. Reforms will also free up capital for investment by raising the MREL threshold and reviewing the ring-fencing regime, while Basel 3.1 rules will be tailored to support UK competitiveness.
Read here to know more on the upcoming initiatives that have been announced.
Bank of England paper on maintaining a fit for purpose resolution regime
On 15 July 2025, the Bank of England (BoE) published a paper on maintaining a fit for purpose resolution regime. The paper outlines the BoE's approach to maintaining a fit-for-purpose resolution regime that ensures financial stability while fostering proportionality for firms of varying sizes and complexities. The paper also summarises the various updates the BoE and the Prudential Regulation Authority are making or are proposing to the resolution regime.
Click here to read further on the proposed updates in relation to the regime.
PRA consults on implementation of Basel 3.1 and adjustments to market risk framework
On 15 July 2025, the Prudential Regulation Authority (PRA) published a consultation paper (CP17/25) on 'Basel 3.1: adjustments to the market risk framework'. The purpose of this consultation is to finalise the implementation of the Basel 3.1 standards in the UK, focusing on market risk requirements under the Fundamental Review of the Trading Book (FRTB).
Read more on the PRA's proposals here.
BoE policy statement on Fundamental Rules for FMIs
On 18 July 2025, the Bank of England published a policy statement on Fundamental Rules for Financial Market Infrastructures (FMIs). These rules, effective from 18 July 2026, outline the high-level outcomes FMIs must achieve in areas such as financial resources, operational resilience, and risk management. The policy is relevant for recognised UK Central Counterparties, recognised UK Central Securities Depositories, UK Recognised Payment System Operators and UK Specified Service Providers.
Click here to read more on these fundamental rules.
EBA final report on draft RTS on crypto exposure values under CRR III
On 5 August 2025, the European Banking Authority (EBA) published a final report on the 'draft regulatory technical standards on the calculation and aggregation of crypto exposure values under Article 501d(5) of the CRR III'. Amongst other things, these draft RTS aim to ensure that institutions have reliable valuation processes of their cryptoasset exposures to ensure that they correctly calculate the own funds' requirements for exposures to cryptoassets within the scope of Regulation (EU) 2023/1114 on markets in crypto-assets (MiCA), which are not financial instruments or commodities.
Click here to learn more on these standards.
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