Conference on the Role of Financial Regulation in International Competitiveness and Economic Growth 2023 | Bank of England | 18 September 2023 | Prudential Regulation Authority, 20 Moorgate, London, EC2R 6DA, UK

The PRA is hosting a major international conference to develop a deeper understanding of the core linkages and relationships between financial regulation and international competitiveness and growth..

Parliament is currently debating a Financial Services and Markets Bill (FSM Bill) that will enable the repeal of retained EU law in financial services and give the Prudential Regulation Authority (PRA) additional responsibilities and wider rule making powers. Under the Bill, the PRA’s primary objective (ensuring the safety and soundness of banks and insurers) will remain the same; however, alongside the current secondary objective to facilitate competition, the PRA will have a new secondary objective. This will require the PRA to act, when it can, to facilitate the UK economy’s international competitiveness and its growth over the medium to long term, subject to alignment with international standards.

To date, the contribution of prudential regulation to international competitiveness and growth has not been a focus of research in academia or the regulatory community. The PRA has indicated that it will be proactive in its approach to implementing the new secondary objective, including looking for specific ways to pursue it.1 As part of this proactive approach, the PRA is hosting a major international conference to develop a deeper understanding of the core linkages and relationships, which will enable it to better implement the objective.

Relevant topics of the conference will include:

• What determines the contribution of finance to growth and international competitiveness of an economy?
• What makes for a successful global financial centre, and how does it retain competitive advantage?
• How to measure the contribution of financial services to the economy?
• How to measure the contribution of prudential regulation to the competitiveness and growth of the economy?

The conference will bring practitioners, regulators, academics and other stakeholders together to develop and deepen the understanding of, consider opportunities for, and discuss issues surrounding facilitating the UK’s international competitiveness and growth when making policy. It will also provide an opportunity to discuss and explore the PRA’s proactive approach to implementing the new objective. In addition, whilst there is a well-developed academic literature on the relationship between competition, financial stability and prudential regulation and its contribution to growth, there is far less on the relationship between financial regulation and international competitiveness. The conference will further the PRA’s commitment to foster research on the relationship between financial regulation and international competitiveness. Note that this is an invite only conference.

To support conference content and inform ongoing work on developing appropriate metrics, the PRA is seeking responses to a survey being piloted. Feedback is requested on the extent to which the PRA’s regulatory framework is advancing the new objective and how the PRA, as a prudential regulator, can further facilitate the implementation of the Secondary Competitiveness and Growth Objective (SCGO) in future. The PRA is seeking feedback from a broad range of stakeholders, including regulated firms, investors, advisors, regulators, civil society, and the academic community. A link to the pilot survey can be found under ‘Related Links’ and readers are welcome to respond.