• PRU A3.2 Capital Requirements

    • Guidance

      1. This table summarises the Capital Requirement that an Authorised Person is subject to and an Authorised Person should hold sufficient Capital Resources at all times to meet the Capital Requirement.
      Capital Requirement Category
      Category <-----------------------------------------------------------------------------maximum of------------------------------------------------------------------------------------>
      Base Capital Requirement2 (USD) Expenditure Based Capital Minimum Risk Capital Requirement3
      Holding Client Assets or Insurance Money?
      No Yes
      1 10mn     Credit, Market, Operational and CVA (plus, where appropriate, Displaced Commercial)
      2 2mn     Credit, Market, Operational and CVA
      3A 500k    
      3B4 4mn 13/52nds of Annual Expenditure 18/52nds of Annual Expenditure
      3C4 250k
      or, where the Financial Services Permission permits only the Regulated Activity of Managing a Collective Investment Fund: (i) 150k for a Public Fund or one available to retail customers or (ii) 50k otherwise
      44, 5 10k 6/52nds of Annual Expenditure
      5 10mn   Credit, Market, Operational, CVA and Displaced Commercial
      2. An Authorised Person, whichever Category it is a member of, must hold a minimum amount of CET1 Capital at the time that it obtains authorisation and at all times thereafter, in accordance with Rule 3.3.3, corresponding to the Base Capital Requirement.
      3. Where the Risk Capital Requirement is the binding capital requirement for an Authorised Person in Category 12 or 5 it must also hold a Capital Conservation Buffer of CET1 Capital of 2.5% of the Total Risk Exposure Amount and, where applicable, a Countercyclical Capital Buffer of CET1 Capital, to be determined in accordance with Section 3.18.
      4. An Authorised Person in Category 3B, 3C or 4 must notify the Regulator immediately if its Capital Resources fall below 120% of its Capital Requirement, in accordance with Rule 3.20.2.
      5. An Authorised Person in Category 4 is only permitted to hold Insurance Monies.