Basel 3.1: Are you ready for the new rules?

However, given the scale and depth of the required changes, institutions must maintain momentum and continue investing in robust preparation ahead of the January 2027 go-live date.  

Basel Final Rules have been published as of 20^th January 2026. The near-final Basel 3.1 rules set out the PRA’s intended framework but still contained gaps, drafting inconsistencies and areas requiring clarification across credit risk, operational risk, market risk and reporting.  

The final rules largely confirm that framework while adding targeted refinements — most notably to market risk — along with numerous technical corrections, clearer definitions and updated templates to ensure the regime is coherent, consistent and ready for full implementation in 2027. 

Go-live readiness checks 

To ensure an effective implementation of Basel 3.1, we have outlined the key considerations to bear in mind. We have broken this up into 4 key areas: Full Compliance to the rules, reporting framework readiness, impact analysis validation, and risk management changes alignment. 

1. Full compliance to rules

• Credit Risk: Ensure implementation of revised standardised and internal ratings-based approaches, including updated risk weights, exposure classifications, and treatment of specialised lending. 
• Market Risk: Confirm adoption of the Fundamental Review of the Trading Book (FRTB) requirements, including new sensitivities-based calculations and stricter boundary definitions between trading and banking books. 
• Operational Risk: Validate transition to the standardised measurement approach (SMA), ensuring accurate calculation based on business indicators and proper integration into capital planning. 

2. Reporting framework readiness 

• Review and update systems and reporting framework to accommodate new COREP templates and requirements. 
• Ensure revised Pillar 3 disclosures reflect updated definitions, assumptions, and calculation logic. 
• Conduct dry runs of new reporting requirements and validate data lineage from source systems through to submission. 

3. Impact analysis validation 

• Perform a comprehensive review of the quantitative impact analysis based on final rules, current portfolios, and market data to avoid surprises post go-live.   
• Prepare and review the templates for PRA data collection exercises [1]. 
• Document impact with timelines and ensure board-level visibility of capital implications. 

 4. Risk management changes alignment 

• Review risk appetite statements and internal limits to reflect potential impact from changes in capital regulation. 
• Update risk policies and procedures to ensure alignment with new requirements.  
• Revise ICAAP processes, risk and capital models, stress testing methodologies to incorporate Basel 3.1 changes. 

Additional considerations 

• Documentation: Maintain clear audit trails of methodology changes, model updates, and governance decisions. 
• Training: Deliver Basel 3.1 training across Finance, Risk, and IT teams to ensure operational readiness. 
• Board Engagement: Ensure senior management understands strategic impacts and signs off on readiness plans. 
• International Coordination: For cross-border groups, align with home regulator timelines and expectations. 

How can Forvis Mazars help you get ready for Basel 3.1 

We review Basel 3.1 preparations in depth, assuring that each element aligns with regulatory expectations and industry best practice. Our team delivers implementation assurance across documentation, governance, frameworks, and compliance, ensuring that all foundational components are robust and well‑evidenced.  

We support firms through detailed impact analysis reviews and assist with the development and refinement of data collection templates, including line‑by‑line comparisons of capital calculation changes. Alongside this, we offer project management support to help coordinate risks and requirements across divisions and teams, enabling a more cohesive and controlled transition.  

Our specialists also provide analytical assistance for new risk metrics and calculations, and deliver tailored training to both senior management and operational teams to ensure organisation-wide readiness. 

Sources  

[1] Basel 3.1 data collection exercise for off-cycle review of firm-specific Pillar 2 capital requirements | Bank of England