1.21 The PRA has a statutory duty to consult when introducing new rules (s138J of FSMA). Specifically, the PRA is required to publish a CBA alongside any proposed rules, defined as an analysis of the costs, together with an analysis of the benefits that would arise if the proposed rules were made and an estimate of those costs and of those benefits, where reasonably practicable to do so.

1.22 The PRA has consulted the CBA Panel ('the Panel') on the preparation of this CBA. The Panel provided feedback on the way the draft CBA analysed the proposals' counterfactual; the average ongoing costs of some proposals; and the explanation of the proposals' positive benefits. A summary of the Panel's comments and how the PRA responded can be found in paragraph 5 of Appendix 4.

Summary of benefits and costs

1.23 The CBA assesses the one-off and ongoing (annual) costs and benefits arising from the proposed framework. Based on the analysis set out below, the PRA expects that the proposals would bring net benefits to the UK financial sector. The full cost benefit analysis is set out in Appendix 4.