The significant policies relate to the adequacy of capital and the Note 1 management of prudential risk and group risk, as set out in the following Chapters. For the requirements for an authorised general risk management Note 2 firm’s strategy—see CTRL, rule 4.1.4. (3) The governing body must review the significant policies from firm’s time to time, taking into account changed operating circumstances, activities and risks. The interval between reviews must be appropriate for the nature, scale and complexity of the business, but must firm’s not be longer than 12 months. (4) The governing body must ensure that the policies are made known to, and understood by, all relevant staff. 1.1.8 Evaluation of information given to firm A banking business governing body must evaluate the firm’s suitability and effectiveness of the information and reports that it and the senior management receive under these rules. The test of firm’s suitability and effectiveness is whether the information and reports are suitable for effectively overseeing and implementing the principles and requirements set out in these rules. 1.1.9 Stress-testing In carrying out stress-testing and developing its stress-testing scenarios, a banking business firm must consider the Basel standards for stress-testing. Committee’s recommended Part 1.2 Principles relating to banking business 1.2.1 Principle 1—capital adequacy A banking business firm must have capital, of adequate amount and appropriate quality, for the nature, scale and complexity of its business and for its risk profile.
Note 1 The significant policies relate to the adequacy of capital and the management of prudential risk and group risk, as set out in the following Chapters. Note 2 For the requirements for an authorised firm’s general risk management strategy—see CTRL, rule 4.1.4. (3) The governing body must review the firm’s significant policies from time to time, taking into account changed operating circumstances, activities and risks. The interval between reviews must be appropriate for the nature, scale and complexity of the firm’s business, but must not be longer than 12 months. (4) The governing body must ensure that the policies are made known to, and understood by, all relevant staff. 1.1.8 Evaluation of information given to firm A banking business firm’s governing body must evaluate the suitability and effectiveness of the information and reports that it and the firm’s senior management receive under these rules. The test of suitability and effectiveness is whether the information and reports are suitable for effectively overseeing and implementing the principles and requirements set out in these rules. 1.1.9 Stress-testing In carrying out stress-testing and developing its stress-testing scenarios, a banking business firm must consider the Basel Committee’s recommended standards for stress-testing. Part 1.2 Principles relating to banking business 1.2.1 Principle 1—capital adequacy A banking business firm must have capital, of adequate amount and appropriate quality, for the nature, scale and complexity of its business and for its risk profile.
QFCRA_9582_VER5.docx