You are viewing COREPRU 7.1 Overall risk assessment as it appeared on 25/10/2027. The current version of COREPRU 7.1 Overall risk assessment was last updated on 25/10/2027.

COREPRU 7.1 Overall risk assessment

Application

25/10/2027R

COREPRU 7 (Overall risk assessment) does not apply to a firm that is both a CRYPTOPRU firm and a MIFIDPRU investment firm.

25/10/2027G

The effect of COREPRU 7.1.1R is that, where a firm is both a CRYPTOPRU firm and a MIFIDPRU investment firm, only the requirements in MIFIDPRU 7 (Governance and risk management) apply.

Purpose

25/10/2027G

The overall purpose of COREPRU 7 is to ensure that a firm:

  1. (1) has appropriate systems and controls in place to identify, monitor and, if proportionate, reduce all risks from the ongoing operation or winding down of the firm’s business that may cause material harm; and
  2. (2) holds financial resources that are adequate for the business it undertakes.
25/10/2027G
  1. (1) COREPRU 7 contain rules and guidance which supplement:
    1. (a) the appropriate resources threshold condition in Schedule 6 to the Act, under which a firm must have appropriate resources in relation to the regulated activities that it carries on;
    2. (b) Principle 3 (Management and control), under which a firm must take reasonable care to organise and control its affairs responsibly and effectively, with adequate risk management systems;
    3. (c) Principle 4 (Financial prudence), under which a firm must maintain adequate financial resources; and
    4. (d) the systems and controls requirements in SYSC, in particular SYSC 4.1.1R, under which a firm must have robust governance arrangements, which include effective processes to identify, manage, monitor and report the risks it is or might be exposed to, and internal control mechanisms.
  2. (2) The requirement for a firm to carry out an overall risk assessment is the articulation of the requirements in (1).
25/10/2027G

This chapter builds on the requirements in COREPRU 7.1.4G and explains how a firm applies them to carry out its overall risk assessment.

25/10/2027G

The rules and guidance in COREPRU 7 also build on the FCA’s general approach to assessing the adequacy of financial resources, as explained in Finalised Guidance, FG20/1 (Our framework: assessing adequate financial resources), which can be found on the FCA’s website at https://www.fca.org.uk/publication/finalised-guidance/fg20-1.pdf. Firms should refer to that guidance when considering their obligations under COREPRU 7.

25/10/2027G

A firm should also refer to the rules and guidance on any supplementary requirements on the overall risk assessment in the sectoral prudential sourcebooks (as applicable).

Point In Time
25/10/2027