2.1 The proposals to require firms to submit a report to the PRA following operational incidents. The PRA's proposed expectations and requirements are found in Appendices 1 and 2.

2.2 The rules would set out specific operational incident reporting requirements for firms. This would include a definition of an operational incident and clear, proportionate thresholds for reporting. Under current requirements, the PRA receives inconsistent reporting from firms on the types and severity of incidents that occur. Similarly, the data the PRA currently receives on incidents lacks consistency, with firms submitting differing information, both in terms of quantity and quality, and using variable terminology to describe incidents. The purpose of these proposed requirements is for the PRA to receive consistent, sufficient, and timely information about operational incidents which pose a risk to the PRA's objectives. This would allow the PRA to:

- assess the potential impact of operational incidents on firms, or on the stability of, and confidence in, the UK financial sector;

- obtain a better understanding of the operational resilience of firms and the financial sector; and

- identify potential vulnerabilities and areas for improvement.