01 · Risk Advisory · Advice and consulting
Risk Advisory is RiskTAE’s advisory and consulting practice for prudential risk, capital and liquidity in regulated financial firms: the ICAAP and ILAAP for banks, the ICARA for investment firms, the ORSA for insurers, and the recovery, resolution and wind-down plans that sit behind them. As advisers, senior practitioners give CROs, CFOs and boards independent challenge and a second opinion. As consultants, the same people write ICAAPs and ILAAPs, build risk frameworks and move capital calculations onto the PRA’s Basel 3.1 rules.
You get work that holds up to board challenge and supervisory review, and a team of your own that can run it next year.
Two offers
Advice is judgement. You keep the pen, and we give you an independent, senior view: a second opinion on the ICAAP before the board signs it, challenge on your risk appetite, preparation before a meeting with the PRA, or a steady hand through a skilled person review.
Consulting is delivery. We hold the pen: we write the ICAAP and ILAAP, build the framework, run the Basel 3.1 recalculation and the stress tests, then hand everything over with documented assumptions so your team can run it next year.
Many clients use both, often in sequence: advice to scope the problem, consulting to fix it, then advice again as an independent check before submission.
Services
A first ICAAP, an annual refresh, or an independent review before the board signs it off. We cover Pillar 1 and Pillar 2 risks, stress and reverse stress testing, and the capital plan that follows from them.
Liquidity risk appetite, the LCR and NSFR, survival horizons, liquidity stress testing and the contingency funding plan, written so the board can see how each number was reached.
Impact assessment against the PRA’s final rules, recalculation of risk-weighted assets under the new approaches, and the knock-on changes to the ICAAP, the capital plan and Pillar 3 disclosures. For smaller firms, an assessment of whether the simplified regime for small domestic deposit takers applies.
Recovery plans with credible indicators and options, resolution packs, and solvent exit and wind-down analysis for firms that need to show they could leave the market in an orderly way.
Risk appetite statements, risk taxonomies, policies and a three lines of defence model that works in a firm of your size.
A written, independent view for the board on a framework or a submission, and support before, during and after a Section 166 skilled person review.
Engagements
Every engagement starts with a 30-minute scoping call and a written proposal that sets out the scope, the timetable and the fee. Where one of our RisKIT models fits, we start from it rather than a blank spreadsheet, which puts a first set of numbers in front of management sooner.
We work inside your team rather than beside it, and we finish with a handover of the models and their documented assumptions to the people who will run them next year. Training for the board or the team can be added from Risk Education, and if the work shows a gap in the team, Risk Talent can fill it.
Track record
Work our senior practitioners have led includes:
an enterprise risk management framework for a start-up bank, which won its UK banking licence after two earlier applications had failed;
operational risk scenarios for a NYSE-listed market maker, after which the PRA accepted its revised operational risk capital and ICAAP;
a risk taxonomy and assessment policies that helped a major UK bank keep its approval to use the advanced measurement approach for operational risk capital;
new risk policies, procedures and staff training that satisfied the UK regulators after a Section 166 skilled person review at the London operation of an overseas bank.
Regulatory deadline
Basel 3.1 and the SDDT regime
Two sets of PRA rules take effect that day. Basel 3.1, published on 20 January 2026 in policy statement PS1/26, applies to PRA-authorised banks, building societies and PRA-designated investment firms, with the internal model approach for market risk following on 1 January 2028. The simplified capital regime for small domestic deposit takers, published the same day in PS4/26, applies to the firms that qualify and opt in.
A firm’s first ICAAP under the new rules needs recalculated risk-weighted assets well before the board is asked to approve it. If yours has not started, the scoping call is the place to begin.
Sources: Bank of England, PS1/26 Implementation of Basel 3.1: final rules, 20 January 2026; PRA PS4/26 The Strong and Simple Framework, 20 January 2026.
FAQ
Both. Some clients want an independent, senior view and keep the work in-house; others want us to do the work. The same senior people do both, and many engagements move from one to the other.
An ICAAP, or Internal Capital Adequacy Assessment Process, is a firm’s own assessment of the capital it needs for the risks it runs, now and under stress. The PRA reviews it as part of its supervisory review and uses it when setting the firm’s Pillar 2 capital requirements.
An ILAAP, or Internal Liquidity Adequacy Assessment Process, is the liquidity equivalent: the firm’s own assessment of the liquidity and funding it needs in normal conditions and under stress. The PRA uses it in its review of the firm’s liquidity position.
Yes. We review drafts against the PRA’s expectations and give the board a written view of the gaps before it approves the document.
Yes. Alongside the PRA’s rules we work with the EU’s Capital Requirements Regulation (CRR III) and with national Basel implementations elsewhere, and our RisKIT models cover UK, EU, US and global Basel frameworks.
In depth
Basel 3.1 applies in the UK from 1 January 2027. We help banks and building societies move capital, reporting and the ICAAP onto the final rules.
02The simplified capital regime for small domestic deposit takers applies from 1 January 2027. We help eligible firms decide, apply and rework the ICAAP.
03ICAAP writing, review and challenge for banks and lenders in the UK and internationally, by practitioners who hand the document and model to your team.
04The PRA's step-in risk rules have applied since 1 January 2026. We build the policy, register and SI returns and assess each entity before your ICAAP.
05ILAAP writing and review, liquidity stress scenarios and board challenge for banks in the UK and internationally, with an open Excel model you keep.
06Recovery and resolution planning (RRP) consultants for banks and lenders: indicators, recovery options, scenario testing and a rehearsed playbook.
07Risk appetite statements and frameworks a board can use: measurable limits, clear escalation and metrics that match the business model.
08Moving to the Basel 3.1 standardised approach for operational risk: the business indicator, the capital impact and what changes in the ICAAP.
09Support before and during a section 166 skilled person review: scoping, evidence, remediation plans and a senior practitioner at your side.
One expert firm
Insights
Basel 3.1, the PRA's version of the final Basel III reforms, applies to UK banks and building societies from 1 January 2027. It reworks the standardised approaches and phases in an output floor that reaches 72.5% of standardised risk-weighted assets on 1 January 2030.
By Mark Dougherty · 8 min readFrom 1 January 2027 an ICAAP has to be written on a Basel 3.1 basis. The PRA set this out in PS15/26: ICAAPs signed off by boards in 2026 should include an impact assessment of Basel...
By Mark Dougherty · 8 min readPillar 2A is the firm-specific capital the PRA requires a bank or building society to hold on top of its Pillar 1 minimum, for risks Pillar 1 does not capture or does not capture fully, such...
By Mark Dougherty · 7 min readNext step
Tell us the deadline and where the work is stuck. We will tell you what it would take to finish it, and whether you need advice, consulting or both.
Tell us what needs doing and by when. A partner will come back to you. Treated in confidence.
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