These Regulations, made by the Treasury using powers granted under the Financial Services and Markets Act 2023, introduce consequential amendments to primary and secondary UK financial legislation.
The regulations align existing laws, specifically mentioning the Banking Act 2009 and various 2014, 2019, and 2020 secondary legislation, with the broader changes stemming from the revocation of retained EU law concerning prudential regulation, taking effect on January 1st, 2026.
Arguments For
Facilitates the UK's post-Brexit regulatory realignment following the repeal of specific EU financial legislation (like the CRR) by the Financial Services and Markets Act 2023.
Ensures necessary technical consistency across UK financial statutes, such as the Banking Act 2009 and related secondary legislation, following the introduction of new Prudential Regulation Authority (PRA) rules.
Provides a clear, defined commencement date (1st January 2026) for the adjustments related to the commencement of major provisions of the 2023 Act.
Arguments Against
The need for numerous consequential amendments suggests complexity and potential for disruption when replacing established EU regulatory frameworks with domestic PRA rules.
Minor technical amendments risk being overlooked, potentially leading to inconsistencies or legal ambiguities in the definitions within inherited legislation (e.g., 'own funds requirements').
The absence of a published impact assessment, while explained by the view of no significant impact, may limit scrutiny for downstream effects on operational compliance for credit institutions.
The Treasury make these Regulations in exercise of the powers conferred by section 83(1) and 83(2) of the Financial Services and Markets Act 2023.
A draft of this instrument has been laid before and approved by a resolution of each House of Parliament in accordance with sections 83(3) and 84(3) and (5) of that Act.
The Treasury created these Regulations using the authority granted under sections 83(1) and 83(2) of the Financial Services and Markets Act 2023.
Before becoming law, a draft of this instrument required approval through a resolution passed by both the House of Commons and the House of Lords, following procedures outlined in sections 83(3) and 84(3) and (5) of that Act.
Part 1 Introduction
This part of the statutory instrument serves to introduce the legislation and provide essential preliminary details.
Citation, commencement and extent 1. (1) These Regulations may be cited as the Financial Services and Markets Act 2023 (Prudential Regulation of Credit Institutions) (Consequential Amendments) Regulations 2025.
The official short title by which these Regulations can be referenced is established here.
They are formally known as the Financial Services and Markets Act 2023 (Prudential Regulation of Credit Institutions) (Consequential Amendments) Regulations 2025.
(2) These Regulations come into force on 1st January 2026.
The date upon which this legislation officially becomes effective is set as January 1st, 2026.
(3) These Regulations extend to England and Wales, Scotland and Northern Ireland.
The geographical scope of these Regulations covers the entirety of England, Wales, Scotland, and Northern Ireland.
Part 2 Amendment of Primary Legislation
This section details the changes being made directly to Acts of Parliament.
Banking Act 2009 2. In section 3(1) (interpretation: other expressions) of the Banking Act 2009—
This regulation specifies amendments affecting section 3(1) of the Banking Act 2009, which deals with interpretation and definitions of various expressions used within that Act.
(a) in the definition of “Common Equity Tier 1 instruments”—
The first change targets the definition of "Common Equity Tier 1 instruments" within the Banking Act 2009.
(i)
after “to (4),” insert “or”
;
The definition is modified by inserting the word "or" immediately following the existing reference range "to (4)".
(ii) omit “or 31(1)”;
The text "or 31(1)" is being removed from the definition.
(b)
in the definition of “own funds requirements”, for “to” substitute “and”
.
In the definition of "own funds requirements," the word "to" is replaced with the word "and".
Part 3 Amendment of Secondary Legislation
This part outlines the adjustments being made to legislation created under the authority of an Act, rather than to Acts themselves.
Bank Recovery and Resolution (No. 2) Order 2014 3. In articles 64(2) (interpretation of Chapter 3) and 68(2) (interpretation of Chapter 4) of the Bank Recovery and Resolution (No. 2) Order 2014, in the definition of “response period”, in sub-paragraph (a), omit “, as applicable,” and “the requirements referred to in Articles 92a and 494 of the capital requirements regulation or”.
Amendments are made within the Bank Recovery and Resolution (No. 2) Order 2014, affecting the definition of "response period" in articles 64(2) and 68(2).
Specifically, the phrases ", as applicable," and "the requirements referred to in Articles 92a and 494 of the capital requirements regulation or" are removed from sub-paragraph (a) of that definition.
Financial Conglomerates and Other Financial Groups (Amendment etc.) (EU Exit) Regulations 2019 4. In regulation 7(6) (transfer of functions to the competent authorities to ensure consistent application of the technical calculation methods of capital adequacy requirements for regulated entities in a financial conglomerate) of the Financial Conglomerates and Other Financial Groups (Amendment etc.) (EU Exit) Regulations 2019, omit sub-paragraph (a) and the “and” after it.
Regulation 4 modifies the Financial Conglomerates and Other Financial Groups (Amendment etc.) (EU Exit) Regulations 2019.
It removes both sub-paragraph (a) and the conjunction "and" that followed it within regulation 7(6), which concerns transferring functions for applying capital adequacy calculation methods.
Bank Levy (Loss Absorbing Instruments) Regulations 2020 5. In regulation 2 (interpretation) of the Bank Levy (Loss Absorbing Instruments) Regulations 2020, in the definition of “relevant requirement”, in paragraph (b), omit “or article 92a”.
This regulation amends the Bank Levy (Loss Absorbing Instruments) Regulations 2020.
In regulation 2, part (b) of the definition of "relevant requirement" is updated by removing the phrase "or article 92a".
Taiwo Owatemi Stephen Morgan Two of the Lords Commissioners of His Majesty’s Treasury 15th December 2025
This section provides the signatures and authority affirming the regulations.
They were signed by Taiwo Owatemi and Stephen Morgan, acting as Two of the Lords Commissioners of His Majesty's Treasury, on 15th December 2025.
Explanatory Note (This note is not part of the Regulations) Section 1 of the Financial Services and Markets Act 2023 (c. 29) revokes assimilated law referred to in Schedule 1 to that Act.
This note clarifies that it is supplementary and not legally part of the Regulations.
It explains that Section 1 of the Financial Services and Markets Act 2023 cancels specified pieces of retained EU law listed in Schedule 1 of that Act.
These revocations include— Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012 (“the CRR”); Commission Implementing Regulation (EU) 2016/1800; Commission Implementing Regulation (EU) 2016/1801; and Commission Delegated Regulation (EU) 2016/1450.
The revoked legislation primarily consists of major EU rules related to capital requirements, including the Capital Requirements Regulation (CRR), and several related Implementing and Delegated Regulations (2016/1800, 2016/1801, and 2016/1450).
The revocations of certain provisions in Parts 1, 2 and 10 of the CRR and the Commission Implementing and Delegated Regulations listed above take effect on 1st January 2026 by virtue of the Financial Services and Markets Act 2023 (Commencement No. 10 and Saving Provisions) Regulations 2025 (S.I. 2025/873 (C. 38)).
The official removal of these specific EU legal provisions, occurring in Parts 1, 2, and 10 of the CRR and the other listed delegated acts, is scheduled for January 1st, 2026.
This timing is established by a separate commencement instrument, S.I. 2025/873.
These Regulations make consequential amendments in connection with those revocations.
The primary purpose of these current Regulations is to enact all necessary minor legislative changes required because of the preceding revocations of EU law.
Most of the revoked CRR provisions will be replaced by Prudential Regulation Authority (“PRA”) rules. The rules can be found at https://www.prarulebook.co.uk/ and a copy can be obtained from the PRA, 20 Moorgate, London EC2R 6DA.
The specific requirements previously found in the CRR are largely being substituted by new rules issued by the Prudential Regulation Authority (PRA).
These PRA rules are accessible online via the provided URL or physically from the PRA office in London.
No impact assessment has been published in respect of these Regulations because no impact, or no significant impact, on the private, voluntary or public sector is foreseen.
A formal impact assessment detailing the financial or operational effects on the private, voluntary, or public sectors was not produced, as the Treasury anticipates these technical amendments will cause no, or only negligible, impact.