FG26/9: Non-Handbook Guidance on COREPRU 7: Overall risk assessment
AI Analysis
The FCA published FG26/9 on 30 September 2026 to explain how firms subject to COREPRU 7 should integrate business-model analysis, risk appetite, financial-resource planning, stress testing and wind-down planning into a single overall risk assessment (ORA). The guidance is non-Handbook and primarily clarifies existing COREPRU 7 obligations, but it sets detailed supervisory expectations for setting own funds and liquidity thresholds, documenting judgments and maintaining a current, evidence-based assessment; it comes into force on 25 October 2027.
Key dates
- 2026-06-30
- FCA consultation on GC26/4 opened.
- 2026-07-30
- FCA consultation on GC26/4 closed.
- 2026-09-30
- FCA published finalised guidance FG26/9.
- 2027-10-25
- FG26/9 comes into force as non-Handbook guidance on COREPRU 7.
Suggested considerations
- Firms should map all regulated and unregulated activities, group dependencies and outsourced services into an inventory of risks capable of causing material harm to clients or the market.
- Compliance and prudential teams may wish to document a clear chain from business model and risk appetite through material risks, controls, stress scenarios, OFTR, LATR, early-warning indicators and management actions.
- Firms should assess own funds and liquid assets separately for ongoing operations and wind-down, test the timing of cash inflows and outflows, and evidence that thresholds meet the applicable OFR, BLAR and sectoral minimums.
- Firms should consider whether their business plan, normally covering approximately three years, has been stress tested against sufficiently severe but plausible firm-specific, market-wide and concurrent scenarios, including reverse stress testing to failure.
- Firms should review whether wind-down plans specify triggers, execution steps, timing, costs, cashflow sequencing and resource needs under stressed conditions.
- Firms should establish governance, independent challenge, version control and documentation standards that preserve the rationale, assumptions, evidence and judgments supporting the ORA.
- Firms may wish to schedule implementation work ahead of 25 October 2027, notwithstanding that the underlying COREPRU 7 obligations already apply and the guidance is non-Handbook.
- Firms should plan an annual ORA review, additional reviews following material business-model or operating-model changes, and retention of the approved ORA for at least three years.
What changed
FG26/9 provides an integrated framework for complying with COREPRU 7.2.1R and the overall financial adequacy rule, covering all regulated and unregulated activities, group and outsourcing dependencies, material-harm risks, risk appetite, systems and controls, the own funds threshold requirement (OFTR), the liquid asset threshold requirement (LATR), stress and reverse stress testing, and wind-down planning. Firms should assess resources for both ongoing operations and wind-down: OFTR is the higher of the firm's own assessment and the applicable regulatory minimum, while LATR cannot be below the basic liquid assets requirement (BLAR) plus any applicable sectoral liquidity requirement. The guidance describes a typically three-year business-plan horizon, forward-looking severe-but-plausible fi
Compliance impact
The guidance does not itself create a new Handbook rule, but it gives the FCA a detailed benchmark for assessing whether firms have complied with COREPRU 7 and maintained adequate own funds and liquid assets. Following SREP, the FCA may require additional resources, governance changes, improvement plans, activity restrictions, additional reporting, a skilled-person review under FSMA 2000 section 1
Who is affected
Related regulations
References
AI-generated analysis. May contain errors or omissions — verify with the original FCA source before acting. Full disclaimer.
What the FCA said
We've published guidance to help firms complete the overall risk assessment required under COREPRU 7. ... Read FG26/9 (PDF)Why we're issuing this guidance We've published guidance to help firms understand how to complete the overall risk assessment required under our Core Prudential sourcebook (COREPRU) rules. It…
Extract from FCA . Read the full notice at the source for the authoritative text.