The opinions expressed here are those of the authors. They do not necessarily reflect the views or positions of UK Finance or its members.

The government is keen for regulators to strike the right balance, which subsequently gives the banks the opportunity to use regulation as a “smart” means for business planning, including to support growth ambitions..

With SS9/17 (Recovery Planning effective from 3 March 2025) and PS5/24 (Solvent Exit Planning for non-systemic banks and building societies effective from 1 October 2025), a lot of work is going into compliance with these policy statements. How do banks optimise business value from this business change? 

The crux of the question posed by the statements revolve around what actions the banks would take in particular stress scenarios and the impact of those actions on the health, and strength of that bank. Systemic banks are considering Resolvability Assessment Framework, Trading Wind Down, Operational Continuity In Resolution and other resolution options whilst non-systemically important banks need to consider solvent wind down plans.

The models used could, and perhaps should, also be used to scenario-plan from a business perspective and not solely from a regulatory compliance point of view. This would enable the business to understand what room for manoeuvre the banks have, whilst continuing to comply with regulatory capital and liquidity requirements, or with any published targets that may have been set.

The regulatory driven change is giving banks an opportunity to look at their challenges of data inconsistency and complexity, siloed and End User Computing heavy manual processes that have increased risk of error. Banks can take advantage of this opportunity by investing in solutions that will also deliver business benefits which connect multiple data sources and provide the ability to scenario plan and model with a range of “what-if” scenarios, comparing them and the flexibility to manage complexities of central/group calculations versus any local calculations and allows for fully integrated workflow and review processes.