2.119 In CP4/23 the PRA proposed to generally not set Pillar 2 add-ons for SDDTs, and to introduce a new, streamlined template that firms could use to describe their Individual Liquidity Adequacy Assessment Process (ILAAP).

2.120 Four respondents supported the PRA's proposal to generally not set Pillar 2 add-ons for SDDTs, other than when warranted by idiosyncratic risks.

2.121 Two respondents supported the new ILAAP template. One respondent commented that the proposed template provided a high-level structure which was similar to that already in place, rather than clearly articulating regulatory expectations on stress testing and scenarios.

2.122 Four respondents suggested that the main burden in producing the ILAAP document was the expectation to produce a new document annually and suggested that the PRA consider reducing the required frequency for the ILAAP document, with one of the respondents suggesting the ILAAP could be produced every other year, alternating with the ICAAP, and another suggesting that an ILAAP should be required to be prepared only in a year that a firm would be undergoing a Liquidity Supervisory Review and Evaluation Process (L-SREP).

2.123 After considering the responses to CP4/23, the PRA has decided to maintain the proposals on Pillar 2 liquidity as set out in the CP to generally not set Pillar 2 add-ons for SDDTs, and with the new, streamlined ILAAP template.