The changes do not affect capital requirements but aim to clarify what qualifies as regulatory capital, reducing legal text volume by 70%.
The regulatory body is working to refine its rulebook for the UK market by removing EU-derived regulations and making requirements clearer and more accessible.
The proposals aim to reduce the time and resources firms spend on compliance without changing capital requirements, supporting growth and maintaining the UK’s financial sector competitiveness.
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Simon Walls, interim executive director of markets at the FCA, said: “We are always trying to be a smarter regulator, and part of that agenda is reducing unnecessary burdens on firms.
“The aim here is to make the rules around how firms hold their capital simpler for the vast majority of firms.
“We want the revised framework to be proportionate, effective, and aligned with the needs of investment firms while maintaining high standards of financial resilience and consumer protection.
“Our proposals support the ambitions that we have set in our new strategy and in the commitments we made to the Prime Minister to streamline regulation and reduce regulatory burden while supporting the growth and competitiveness of the UK.”
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