2.89 CP5/22 did not contain any definitive proposals on how the SDDT regime would be operationalised. However, the CP did set out the PRA's intention to propose in future consultations that any firm meeting the SDDT criteria would be automatically in scope of the SDDT regime.

2.90 The PRA also set out an intention to consult on an approach that would allow SDDTs the flexibility to either be subject to Basel 3.1 without delay, or to be subject to a transitional regime that would allow them to be subject to currently applicable UK capital requirements regulation (CRR) until such time as the SDDT capital regime was implemented. A proposal consistent with this intention was subsequently consulted on in CP16/22.

2.91 Two respondents welcomed the proposal that SDDT firms could chose to be subject to Basel 3.1 without delay. One respondent supported the PRA's desire to minimise the frequency of material regulatory changes, including aligning the timing between the introduction of the SDDT regime and Basel 3.1. Another respondent supported implementing the SDDT regime at the same time as the Basel 3.1 standards.