Bank of England regulator to set performance targets under five-year PRA strategy

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Bank of England PRA strategy targets

Highlights

Katharine Braddick will announce measurable performance targets for the Bank of England's PRA, including faster licence and executive approvals, as part of a five-year strategy.
Braddick's plan emphasizes transparency, regulatory data reduction, technology adoption—including AI—and heightened operational risk protection, with detailed strategy publication expected Q1 next year.
The PRA faces growing pressure from the City of London for deeper capital cuts to support lending and competitiveness, especially after recent U.S. regulatory easing for Wall Street banks.

Strategy targets and regulatory overhaul

As first reported by the Financial Times, Katharine Braddick is set to use a Mansion House speech on Thursday to commit the Bank of England's Prudential Regulation Authority to measurable performance targets as part of a new five-year strategy.

Those targets are likely to include faster approvals for licence applications and senior executive appointments, as well as reducing the amount of data that banks and insurers must submit to the regulator. Braddick is expected to present fuller details of the strategy in the first quarter of next year, marking the first time the PRA publishes a strategy and sets metrics against which parliament can hold it to account.

People familiar with the matter say Braddick is also focusing on greater transparency, better use of technology including AI, stronger support for economic growth and stronger protection for the financial system against operational threats such as cyber attacks. Her plan follows the Treasury's inclusion of a requirement for the PRA to publish its strategy in the financial services bill now under debate in parliament.

City expectations and competitive pressure

The move is expected to be welcomed in the City of London, where the PRA has often been viewed as slower than the Financial Conduct Authority to respond to the secondary objective of supporting growth and competitiveness that both regulators received in 2023.

Braddick joined the PRA in July from Barclays, where she was head of strategic policy, after earlier senior roles at the Treasury, the Bank of England and the Financial Services Authority. Her appointment as chief supervisor for the banking sector has been seen in many parts of the City as a signal that the government is serious about reshaping regulation to help the economy.

She is expected to argue that the PRA must explain its objectives more clearly and accept greater accountability if it is to preserve credibility and legitimacy. While the regulator has already eased some rules in recent years, including on bankers' bonuses, bank capital and mortgage lending, financial groups continue to press for deeper cuts to capital requirements to support lending and protect UK competitiveness after U.S. regulators moved to soften rules for Wall Street banks.

The Bank of England’s push for banks to strengthen cyber resilience highlighted how AI is increasing the scale and complexity of attacks on critical financial services. In our earlier coverage, we explained that supervisors are pressing large lenders to plan “bare metal” recovery options so essential operations can be restored even if core systems are compromised.

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