PRA: “Dear CFO” letter: Significant risk transfer financing – prudential expectations

PRA has published the text of this letter which highlights practices it has observed in relation to illiquid and structured financing portfolios across regulated firms.  The regulator expects firms to consider the concerns highlighted and, where necessary, ensure that associated policies, control frameworks and reporting are enhanced to address any issues identified.  It is noted that supervisors will be in contact with relevant firms to request a response to the letter – such firms are instructed to provide a written response by 11 June 2025 which should outline certain details requested in this letter.