Pillar 3 Disclosures


Pillar 3 of the Capital Requirements Directive (CRD) requires us to publish certain details of our risks, capital and risk management processes. We publish these details in accordance with the relevant provisions of the FCA’s Handbook, known as the BIPRU 11 rules. MIM is authorised under these rules as a BIPRU firm, classified as a non-ILAS (Individual Liquidity Adequacy Standards) firm. In circumstances where we deem certain information to be immaterial or of a proprietary or confidential nature, we are not obligated to make a disclosure.

The CRD also consists of two other ‘pillars’. Pillar 1 decrees the minimum capital requirements that we are required to meet for credit, market and operational risk. Pillar 1 capital is made up of our base capital resources requirement plus the variable capital requirement, which for MIM has been determined as the Fixed Overhead Requirement (FOR).

Pillar 2 requires us to assess whether we should hold additional capital to offset capital risks not covered by Pillar 1.

Risk Management Structure

The Governing Body does not believe a separate Risk Committee is viable and risk management is carried out by the firm’s Compliance function.

The firm’s Risk Management Framework is reviewed on an ongoing basis by Compliance and the firm’s Governing Body.

Risk Management Objectives and Policies

Our risk management policy reflects the FCA requirement that we must manage a number of different categories of risk, not included within Pillar 1. These are known as Pillar 2 risks. These are listed below:

Business Risk – is a calculation of the risk of annual Balance Sheet liabilities expected to fall due where there is a mismatch of assets to liabilities. MIM holds additional Pillar 2 capital to mitigate this risk.

Liquidity Risk – is a calculation of the risk that a firm, although solvent, either does not have available sufficient financial resources to enable it to meet its obligations as they fall due, or can secure such resources only at excessive cost. MIM holds additional Pillar 2 capital to mitigate this risk.

PI Policy Risk  is a calculation of the risk posed by MIM’s PI policy exclusions, the deductible on sums insured and any uninsured claims. MIM holds additional Pillar 2 capital to mitigate the risk of customer claims and legal action in the future.

Regulatory Levies – is an assessment of the risk of future extraordinary regulatory levies. MIM has assessed this risk and does not currently hold additional Pillar 2 capital in this respect.

Remuneration Risk – is an assessment of the risk posed by MIM’s Remuneration Policies. MIM has assessed this risk and does not currently hold additional Pillar 2 capital in this respect.


MIM’s exposure to these applicable risks will be addressed through holding relevant capital, as stated, to mitigate the risks identified and to absorb any losses that unexpectedly materialise and by having in place adequate systems and controls to manage the risks identified.

MIM’s Capital Resources total is made up entirely of Tier One Capital. This comprises P&L Reserves and share capital.

Compliance With BIPRU

We have identified and assessed the material risks outlined above and have made appropriate provision for them. Our Pillar 2 capital requirement has been assessed as being greater than our Pillar 1 requirement. It is, therefore, our Pillar 2 figure that represents the minimum regulatory capital that we will hold.

We have assessed our total Pillar 2 capital requirement against our capital resources. The process by which we make this assessment is known as our Internal Capital Adequacy Assessment Process (ICAAP). Our Pillar 2 figure is, therefore, known as our ICAAP capital figure. The firm’s actual capital resources figure is significantly higher than our ICAAP capital figure.

Our Pillar 2 capital figure, our assessment of the risks identified within our ICAAP and the mitigation actions being utilised are reviewed  on a quarterly basis and fully updated on a half-yearly basis. At each period end we review the firm’s capital resources against the ICAAP capital figure, ensuring that the former remains adequate to cover the nature and level of the risks to which the firm is or might be exposed. We then review revenue and expenses and how much current and future capital may be necessary and thereby monitor the success of the firm’s capital planning.

Our current operating philosophy on capital management is that the existing capital structure will remain in place over the next year. This links in with the 1 year projections within our ICAAP. Business planning, both current business structure and developments outlined for the next year, will be funded from revenue surpluses, where achievable. Our business plan/strategy for future requirements purposes is deemed to be achievable when assessed against current revenue and expense figures. We are confident that going forward the firm will be able to manage its business and capital alongside meeting its minimum regulatory requirements.

The Governing Body is confident that the risks identified are within the firm’s risk appetite and confirms its ability to manage those risks through its ICAAP process.

Disclosure of Remuneration

The firm has in place a Remuneration Policy. The Governing Body oversees the approval of all fixed and variable remuneration for all individuals working in the business. The Governing Body does not believe a separate Remuneration Committee is viable. All remuneration paid for this financial year has been paid in line with the BIPRU Remuneration Code . None of the individuals identified under the Remuneration Policy as “Remuneration Code Staff” is deemed by the Governing Body to be a material risk-taker.


Disclosures in relation to the following risk categories have been considered immaterial under BIPRU 11.3.5R (Exemption from disclosure: Materiality).

– Business/Income Default Risk – Operating risk is covered within the Pillar 1 Capital figure.

– Claims Risk – There are no known claims against the firm at present.

– Concentration Risk – MIM has no separate exposure to credit risk.

– Credit Risk – MIM has no exposure to any of the classes listed in BIPRU 11.5

– Group Risk – MIM is not a member of a consolidation group.

– Insurance Risk – MIM has no exposure to insurance risks

– Interest Rate Risk – MIM has no exposure to interest rate transactions.

– Market Risk – As a BIPRU firm MIM is exempt from the requirement to make a separate calculation to cover market risk.

– Operational Risk – As a BIPRU firm MIM is exempt from the requirement to hold capital to cover operational risk.

– Pension Obligation Risk – MIM has no exposure to pension obligation risk.

– Residual Risk – MIM has no separate exposure to credit risk.

– Securitisation – MIM does not participate in securitisations.

– MIM is not part of a consolidation group for MiFID purposes