The Economic Secretary to the Treasury Andrea Leadsom said that the rules will come into force from March 2016 and are aimed at making it easier for regulators to punish bankers for irresponsible decisions.
According to Leadsom, companies are required to notify the regulators by 8 February 2016 of the approved persons who are to be senior managers under the Senior Managers and Certification Regime (SM&CR).
This will help aid an orderly transition from the existing approved persons’ regime. The new rules are set to be extended to branches of foreign banks in the UK on 7 March 2016.
The commencement order will also bring sections 36 to 38 of the Act into force during the same period, which means that the criminal offence pertaining to decisions that cause a lender to fail could apply to decisions taken by senior managers in UK banks.
The Prudential Regulation Authority (PRA) and Financial Conduct Authority (FCA) plan to consult on additional SM&CR rules soon.
Leadsom said that the rules will help ensure that the regime is applied in a suitable way to foreign institutions operating through branches in the UK.
