1.7 This CP sets out the PRA's proposed rules and expectations with respect to the implementation of the Basel 3.1 standards, and consists of the following:

- a revised SA for credit risk;

- revisions to the internal ratings based (IRB) approach for credit risk;

- revisions to the use of credit risk mitigation (CRM) techniques;

- removal of the use of IMs for calculating operational risk capital requirements, [Throughout this CP, the PRA uses the term 'capital requirements' since it is commonly understood in the industry as equivalent to 'own funds requirements', which is the term used in the CRR and proposed rules.] and a new SA to replace existing approaches;

- a revised approach to market risk; [Sometimes referred to as the 'Fundamental Review of the Trading Book'.]

- the removal of the use of IMs for credit valuation adjustment (CVA) risk, replaced by new standardised and basic approaches; and

- the introduction of an aggregate 'output floor' to ensure total RWAs for firms using IMs and subject to the floor cannot fall below 72.5% of RWAs derived under SAs, to be phased in over five years.