UK implements FMI principles, improvements recommended
The Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO) assessed the United Kingdom's implementation of Principles for Financial Market Infrastructures (PFMI). The assessment found the UK's framework for payment systems and central securities depositories is largely consistent, but recommends some improvements.
Strong foundation, areas for growth
The joint assessment by the Bank for International Settlements' Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO) found the United Kingdom's framework for systemically important payment systems (PSs) and central securities depositories (CSDs)/securities settlement systems (SSSs) to be largely consistent with the Principles for Financial Market Infrastructures (PFMI).
The report, titled 'Implementation monitoring of PFMI: Level 2 assessment report for the United Kingdom – PSs and CSDs/SSSs,' specifically examined the completeness and consistency of the legal, regulatory, and oversight frameworks as they stood on September 30, 2023.
It concluded that the implementation for PSs is complete and consistent with all Principles, while for CSDs/SSSs, it is complete and consistent in most aspects.
This comprehensive review provides a snapshot of the UK's adherence to international standards for critical financial infrastructure.
Targeted improvements needed
Despite the overall positive assessment, the CPMI-IOSCO report identified specific areas where further improvements are recommended.
These include aspects where the implementation of the PFMI was deemed broadly, partly, or not consistent with the Principles, particularly concerning risk and governance principles.
The findings highlight the need for targeted enhancements to ensure full alignment with international best practices.
The assessment strictly reflects the status of implementation as of September 2023, and any subsequent developments in the legal, regulatory, and oversight frameworks were not included in the scope of this particular report.