Wyelands censured for breaching large exposure limits

According to the PRA, the censure against Wyelands Banks is for wide-ranging significant regulatory failings between 21 December 2016 and 28 May 2020.

The regulatory failings spanned breaches relating to large exposure limits, capital reporting, governance and risk controls and PRA Own Initiative Requirements (OIREQs), and poor retention of WhatsApp messages.

The bank was also found to be in breach of PRA Fundamental Rule 3 (requiring a firm to act in a prudent manner). The seriousness of the breaches justifies a substantial fine of £8,515,000.

However, Wyelands is in wind down and the PRA accepted that it has very limited financial resources. The PRA has concluded that fining Wyelands would not advance its general objective to promote the safety and soundness of firms.

Wyelands became a member of the Gupta Family Group Alliance (GFG) in December 2016. In September 2019, the PRA required Wyelands to limit its exposures to GFG and connected parties due to concerns that it had an unacceptable concentration of risk. By March 2020, Wyelands had stopped entering into new credit transactions and commenced a wind down of its business. In March 2021, the PRA required Wyelands to repay its depositors, which has been successfully completed.

Sam Woods, deputy governor for Prudential Regulation and chief executive officer of the PRA, said: ‘The PRA expects firms to establish and maintain effective governance and risk management controls at all times. This is particularly important where a firm engages in complex transactions or where a significant proportion of its business is introduced by its wider group. Wyelands’ wide-ranging and serious failings resulted in the PRA taking swift supervisory action to minimise the risk to depositors and issuing today’s strong censure.’

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