Basel 3.1 — PRA PS1/26 Regulatory Reference

Basel 3.1 — PRA PS1/26 Regulatory Reference

Basel 3.1 as implemented by PRA PS1/26 for UK firms, effective 1 January 2027. The framework shifts emphasis from risk sensitivity to comparability and floors.

Where the numbers live

This skill does not state regulatory values. Every value tables in the reference files below is generated from the rulepack (src/rwa_calc/rulebook/packs/{common,crr,b31}.py) by uv run python scripts/generate_regulatory_tables.py, and scripts/check_skill_values.py fails the build if a value is reintroduced as prose.

This is a graduated lesson, not a style preference: hand-maintained copies of pack values drifted three times in this repo — the corporate CQS5 Basel 3.1 risk weight was stated here as 100% in three separate files while the pack, the engine and PS1/26 Art. 122(2) Table 6 all said 150%.

So, when you need a number:

1. Read the generated table in the relevant reference file below — each ### entry_name heading is the literal pack key, with its citation.
2. Or grep the pack directly: rg 'b31_corporate_risk_weights' src/rwa_calc/rulebook/packs/.
3. Or read the whole rendered pack: docs/data-model/regulatory-tables.md.

Do not try to extract values from the source PDFs for routine lookups. Most agents cannot read docs/assets/*.pdf at all, and PS1/26 renumbers articles — the [Note: corresponds to Article NNN] line, not the printed number, tells you which CRR article a PS1/26 article maps to. Use the PDFs to audit a pack value you have reason to doubt, and when you do, fix the pack.

What changed from CRR — qualitatively

The magnitude of each change lives in the generated tables; the shape of it is here.

1. Output floor — IRB RWA floored against an SA recalculation of the whole portfolio
2. Supporting factors removed — no SME or infrastructure relief
3. IRB scaling factor removed — a uniform reduction in IRB RWA before the floor
4. PD floors differentiated — class-specific, where CRR used one uniform floor
5. A-IRB LGD floors introduced — by collateral type; CRR had none
6. F-IRB supervisory LGD reduced — for senior non-FI corporates and secured positions
7. A-IRB restricted — large corporates, FIs and institutions become F-IRB only
8. Equity IRB removed — SA only, with a transitional phase-in
9. Real estate becomes a standalone class — PRA loan-splitting, not the BCBS whole-loan table
10. New retail sub-categories — transactor and payroll/pension

Quick Navigation

External Regulatory Sources

• PRA PS1/26: https://www.bankofengland.co.uk/prudential-regulation/publication/2026/january/implementation-of-the-basel-3-1-final-rules-policy-statement
• PRA PS1/26 Appendix 1 (full rules): https://www.bankofengland.co.uk/-/media/boe/files/prudential-regulation/policy-statement/2026/january/ps126app1.pdf
• BCBS CRE Standards: https://www.bis.org/basel_framework/standard/CRE.htm
• Source PDFs: docs/assets/ps126app1.pdf (full rules), docs/assets/comparison-of-the-final-rules.pdf (delta summary) — for auditing a suspect pack value, not for routine lookup
• BoE regulatory reporting (banking sector): https://www.bankofengland.co.uk/prudential-regulation/regulatory-reporting/regulatory-reporting-banking-sector
• BoE banking XBRL taxonomy validations v4.0.0: https://www.bankofengland.co.uk/-/media/boe/files/prudential-regulation/regulatory-reporting/banking/2026/february/boebankingtaxonomyvalidationsv400.zip — raw at docs/assets/boe-banking-taxonomy-validations-v4.0.0.zip (gitignored; uv run python scripts/download_docs.py), extract at src/rwa_calc/reporting/validations/rules/basel31-boe-v4.0.0-credit-risk.json

Project Specification & Comparison Files

Key Regulatory Sections

Basel 3.1 Exposure Class Waterfall (Art. 112, Table A2)

Priority ordering — the highest-priority class applies where an exposure meets several criteria:

1. Securitisation positions
2. CIU units/shares
3. Subordinated debt, equity and own funds instruments
4. Items associated with particularly high risk
5. Exposures in default
6. Eligible covered bonds
7. Real estate exposures (new standalone class)
8. International organisations
9. Multilateral development banks
10. Institutions
11. Central governments / central banks
12. Regional governments / local authorities
13. Public sector entities
14. Retail exposures
15. Specialised lending (new)
16. Corporates
17. Other items

Transitional Schedules

Both phase-in schedules are pack Schedule entries, rendered in the reference files:

• Output floor (Art. 92(5)) — output_floor_pct, see references/output-floor.md
• Equity SA (Art. 4.2/4.3) — equity_transitional_std_rw and equity_transitional_hr_rw, see the CRR skill's slotting-and-equity.md

IRB transitional (Art. 4.4-4.6): firms with IRB permission use the higher of the old IRB methodology and the transitional SA schedule. An irrevocable opt-out is available.