BIPRU 1.3 Applications for advanced approaches and waivers2

1. (1)

   A firm may apply for 7a waiver in respect of:

   1. (a)

      the IRB approach;

   2. (b)

      [deleted]5

      5
   3. (c)

      the CCR internal model method; and

   4. (d)

      the VaR model approach.

2. (2)

   A firm should apply for a waiver if it wants to:

   1. (a)

      apply the CAD 1 model approach; or2

   2. (b)

      apply the master netting agreement internal models approach; or2

   3. (c)

      disapply consolidated supervision under BIPRU 8 for its UK consolidation group or non-UK sub-group7; or2

   4. (d)

      apply the treatment in BIPRU 2.1 (Solo-consolidation waiver); or

   5. (da)

      2apply the treatment for a core UK group in BIPRU 3.2.25 R (Zero risk-weighting for intra-group exposures).5

      5
   6. (e)

      [deleted]512

      25
   7. (f)

      [deleted]5

      25

As explained in SUP 8, under section 138A3 of the Act, the appropriate regulator may not grant a waiver to a firm unless it is satisfied that:

1. (1)

   compliance by the firm with the rules, or with the rules as modified, would be unduly burdensome or would not achieve the purpose for which the rules were made; and

2. (2)

   the waiver would not adversely affect the advancement of any of the appropriate regulator's objectives.3

   3

The conditions relating to the use of an approach listed in BIPRU 1.3.2 G referred to in the relevant chapter of BIPRU are minimum standards. Satisfaction of those conditions does not automatically mean the appropriate regulator will grant a waiver referred to in those paragraphs. The appropriate regulator will in addition also apply the tests in section 138A of the Act.

In the appropriate regulator's view, if the minimum standards referred to in BIPRU 1.3.11 G are satisfied, the conditions referred to in BIPRU 1.3.10 G (1) will generally be met.

In respect of the application for waivers to apply the approaches set out in BIPRU 1.3.2 G (1), the appropriate regulator will aim to give decisions on applications as soon as practicable. However, the appropriate regulator expects that it will take a significant period to determine and give a decision due to the complexity of the issues raised by the applications. Details of timelines for applications for waivers to use advanced approaches 7are set out on the appropriate regulator website.

Before sending in an application for a waiver,7 a firm may find it helpful to discuss the application with its usual supervisory contact at the appropriate regulator. However, the firm should still ensure that all relevant information is included in the application.