140.—(1) This Chapter applies where neither the PRA nor the FCA is the consolidating supervisor in relation to a relevant group.
(2) In this Chapter—
“four month period” means four months beginning with the date on which the group-level resolution authority gives the Bank notice of its provisional determination of the minimum consolidated requirement as referred to in article 131(2);
“group entity” and “minimum requirement” have the same meaning for the relevant group as they have for a relevant group in Chapter 2;
“group institution”, “non-UK institution” and “UK institution” have the same meaning for the relevant group as they have for a relevant group in Chapter 4; and
“netting arrangement” has the same meaning as in Chapter 2.
141.—(1) The Bank must exercise the powers conferred by section 3A of the Banking Act 2009—
(a)to ensure that a UK institution is required at all times to maintain a minimum requirement; and
(b)with the object of ensuring that at all times the institution meets the minimum requirement specified in a direction given for that purpose.
(2) The Bank must—
(a)make a provisional determination of the minimum requirement for each UK institution;
(b)give notice of that provisional determination to the group-level resolution authority and other resolution authorities for non-UK institutions;
(c)endeavour within the college to determine jointly with those authorities the minimum requirements for each UK institution and each non-UK institution.
(3) The Bank must inform EBA of the minimum requirement determined for each UK institution.
142.—(1) This article applies for the purpose of determining the minimum requirement for a group institution.
(2) The amount of the institution’s total liabilities must include total liabilities under any derivative contracts held by the institution.
(3) An assessment of total liabilities under a derivative contract must take account of the rights of the parties to the contract to set off or net under a netting arrangement.
(4) A liability must be excluded from the amount of the institution’s own funds or eligible liabilities if—
(a)the instrument that creates the liability is not issued or fully paid up;
(b)the liability is owed to, or secured or guaranteed by, the institution itself;
(c)the purchase of the instrument that creates the liability was funded directly or indirectly by the institution itself;
(d)the liability has a remaining maturity of less than one year;
(e)the liability arises from a derivative contract held by the institution;
(f)the liability arises from a deposit in respect of which the depositor’s rights, in any proceedings relating to the insolvency of the institution, would be preferred to the rights of other creditors; or
(g)the instrument that creates the liability is governed by the law of a third country and the Bank is not satisfied that a decision by the Bank to convert or write down the liability would be effective under that law.
(5) For the purpose of paragraph (4)(d), where the instrument that creates the liability confers on a party to the instrument a right to the repayment of a sum before maturity, the maturity date is the first date on which that party would become entitled to repayment if the right were exercised.
(6) The determination—
(a)must be based on an assessment of the criteria set out in Article 45.6 of the recovery and resolution directive; and
(b)must take account of the minimum consolidated requirement (within the meaning given in Chapter 2) which is determined for the relevant group.
(7) Where the determination is for a UK institution, the Bank must make the assessment under paragraph (6)(a) in consultation with—
(a)the PRA, if the institution is a PRA-authorised person;
(b)the FCA, if the institution is any other UK authorised person.
143.—(1) Where the Bank endeavours to determine minimum requirements for group institutions jointly with one or more other resolution authorities under article 142(2)(c), it must endeavour to make the determination within the four month period.
(2) Where the Bank and other resolution authorities are unable within the four month period to make a joint determination of minimum requirements for group institutions, the Bank must determine the minimum requirements for UK institutions having regard to any views or reservations expressed by the group-level resolution authority during the four month period.
(3) The Bank must give each UK institution written notice of the determination of its minimum requirement, including a reasoned account of the determination.
144.—(1) Where, before the end of the four month period, the group-level resolution authority has referred any matter relating to the prospective determination of a minimum requirement for a UK institution to EBA in accordance with Article 19 of the EBA Regulation, the Bank must—
(a)defer the determination for one month beginning with the date on which the four month period ends; and
(b)ensure that the requirement determined is not less than the requirement specified in any decision taken by EBA before the end of that month under Article 19.3 of the EBA Regulation.
(2) For the purposes of a reference to EBA of a matter to which this article refers the four month period is deemed to be the conciliation phase referred to in Article 19.2 of the EBA Regulation.
145.—(1) This article applies where the group-level resolution authority reviews the group resolution plan.
(2) Articles 141 to 144 apply for the purpose of reviewing the minimum requirements for group institutions, but have effect for that purpose as if the reference to determining (and each reference to the determination of) the requirements were a reference to re-determining (or the re-determination of) the requirements on review.
146.—(1) The Bank may decide, after consulting the regulator (within the meaning given by article 139(3)), that a group entity, other than an institution, set up in the United Kingdom should be required to maintain a minimum requirement for own funds and eligible liabilities expressed as a percentage of the entity’s total liabilities and own funds.
(2) Where the Bank makes a such decision, articles 141 to 145 apply for the purpose of determining and reviewing the requirement and ensuring that the requirement is maintained and met, but have effect for that purpose as if each reference to an institution, except a reference to a non-UK institution, included a reference to the group entity for which the requirement is being (or has been) determined.