SS5/25: Bridging the Gap Between Flood Models and Actual Flood Events

The UK Prudential Regulation Authority’s (PRA) Supervisory Statement 5/25 came into force on 3 December 2025. SS5/25 requires banks to assess physical climate risk at asset level across their lending portfolios, integrate it into credit and capital processes, and demonstrate that their data is granular and defensible enough to withstand supervisory scrutiny. Following publication, firms were granted a six-month gap assessment period, which ended on 3 June 2026, to assess their existing capabilities against the requirements.