Large-exposure rules tighten trading limits from 2028

The PRA retains third-party trading book exposures up to 85 percent of Tier 1 capital for at most 10 business days, rather than removing the allowance.

Non-trading exposures must meet ordinary limits; excesses require additional capital and immediate reporting.

Intragroup trading allowances fall to 85 percent, with a 100 percent risk weight on excesses.

Internal models will no longer measure securities financing exposures.

To accommodate higher measured exposures, the higher Non-Core Large Exposures Group (NCLEG) trading limit rises from the proposed 250 percent to a uniform 350 percent; non-trading relief remains capped at 100 percent.

Wind-down practices inform permission assessments but are not a standalone condition.

Ordinary limits remain 25 percent of Tier 1 capital or £130 million, whichever is greater.

Mandatory substitution reassigns exposure reductions from eligible credit risk mitigation to collateral issuers or protection providers.

All firms must apply it, including for corporate collateral.

Funded sovereign collateral and tri-party repo collateral receive limit exemptions; sovereign guarantees qualify only at a zero percent risk weight.

Certain clearing-related indirect exposures are also exempt, while cash collateral falls outside substitution.

Firms must still report exempt indirect exposures separately from direct exposures.

Reporting templates remain unchanged.