Prudential Regulation Authority (PRA) definition
Created by the Financial Services Act in 2012, the Prudential Regulation Authority (PRA) is part of the Bank of England (BoE). It is responsible for the prudential regulation and oversight of roughly 1700 banks, building societies, credit unions, insurance and investment firms.
The PRA’s objectives are to promote the safety and soundness of the firms it regulates, and to encourage effective competition. It sets out to achieve these aims through:
- Regulation – setting standards and policies for firms to uphold
- Supervision – assessing risks to its objectives and taking measures to reduce them