PRA and FCA share observations of good practices on risk controls for DvP clients

Released 02 June 2021

The Prudential Regulation Authority (PRA) and Financial Conduct Authority (FCA) have sent a ‘Dear Chief Risk Officer’ letter to regulated firms to share observations of good practices related to monitoring and mitigating counterparty credit risks in relation to Delivery versus Payment (DvP) clients.

The letter covers various areas including credit risk framework, ongoing oversight of clients and escalation procedure and encourages firms to incorporate the observations within their control framework.

Further information can be found at https://www.bankofengland.co.uk/prudential-regulation/letter/2021/june/pre-settlement-counterparty-credit-exposure-management-controls-for-dvp-clients.

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