The Bank Recovery and Resolution ( No. 2) Order 2014

Article 40(3)

SCHEDULE 2 U.K. Information to be contained in a group resolution plan

The context for resolution action U.K.

1.—(1) In drawing up a group resolution plan the Bank must have regard to the different circumstances under which group entities may meet the conditions for resolution.

(2) The circumstances to which the Bank must have regard include the following—

(a) that there is a situation of widespread financial instability or an occurrence of events which pose systemic risk; and

(b) that there is no such a situation or occurrence.

(3) In drawing up a group resolution plan the Bank must not assume that any group entity will be in receipt of—

(a) extraordinary public financial support other than financing arrangements made in accordance with [F1 section 228 or 229 of the Banking Act 2009];

(b) emergency liquidity assistance M1 ; or

(c) any other liquidity assistance provided by the Bank or any other central bank under non-standard collateralisation, tenor and interest rate terms.

Textual Amendments

F1 Words in Sch. 2 para. 1(3)(a) substituted (31.12.2020) by The Bank Recovery and Resolution and Miscellaneous Provisions (Amendment) (EU Exit) Regulations 2018 (S.I. 2018/1394), reg. 1(2), Sch. 3 para. 118(2); 2020 c. 1, Sch. 5 para. 1(1)

Marginal Citations

M1 For the meaning of “emergency liquidity assistance” see the recovery and resolution directive, Article 2.1, point (29).

Contents of group resolution plan U.K.

2.  A group resolution plan must—

(a) set out the resolution [F2 tools that would be applied, the resolution powers that would be exercised] or insolvency proceedings that would be taken in respect of [F3 each resolution entity in the relevant group];

[F4 (b) set out the implications of sub-paragraph (a) for—

(i) the other group entities in the same resolution group as the resolution entity; and

(ii) any other resolution group in the relevant group;]

(c) include a consideration of measures for facilitating the purchase by a third party of the relevant group as a whole or of separate business lines or activities delivered by any group entity [F5 or any resolution group];

(d) identify and assess potential impediments in relation to the relevant group as a whole to—

(i) the co-ordination of [F6 the application of resolution tools or the exercise of resolution powers];

(ii) the effectiveness of [F6 the application of resolution tools or the exercise of resolution powers] or the achievement of the resolution objectives;

(e) where any subsidiary within the relevant group is set up in a third country, set out—

(i) arrangements for co-ordinating [F7 the application of resolution tools or the exercise of resolution powers], and co-operating, with the authorities which, in the country concerned, exercise any function equivalent to a function of [F8 the Bank under Part 1 of the Banking Act 2009 or a] competent authority; and

(ii) the implications of such co-ordination for the resolution M2 of that subsidiary and group entities;

(f) set out measures which the Bank considers it would be necessary to take to facilitate group resolution M3 , including by the legal or economic separation of specified functions or business lines of [F9 resolution entities];

(g) set out any other measures which the Bank would take or considers it would be necessary to take to facilitate group resolution in respect of [F10 each resolution group in] the relevant group;

(h) a detailed description of the assessment of resolvability made in respect of the relevant group in accordance with Chapter 2 of Part 6; [F11 and]

(i) explain how the [F12 application of resolution tools or the exercise of resolution powers] set out in the plan could be financed (without the assumption that any group entity would be in receipt of the support or assistance referred to in paragraph 1(3))F13 ...

F14 (j) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F2 Words in Sch. 2 para. 2(a) substituted (31.12.2020) by The Bank Recovery and Resolution and Miscellaneous Provisions (Amendment) (EU Exit) Regulations 2018 (S.I. 2018/1394), reg. 1(2), Sch. 3 para. 118(3)(a); 2020 c. 1, Sch. 5 para. 1(1)

F3 Words in Sch. 2 para. 2(a) substituted (28.12.2020) by The Bank Recovery and Resolution (Amendment) (EU Exit) Regulations 2020 (S.I. 2020/1350), regs. 1(2), 59(a)

F4 Sch. 2 para. 2(b) substituted (28.12.2020) by The Bank Recovery and Resolution (Amendment) (EU Exit) Regulations 2020 (S.I. 2020/1350), regs. 1(2), 59(b)

F5 Words in Sch. 2 para. 2(c) inserted (28.12.2020) by The Bank Recovery and Resolution (Amendment) (EU Exit) Regulations 2020 (S.I. 2020/1350), regs. 1(2), 59(c)

F6 Words in Sch. 2 para. 2(d)(i)(ii) substituted (31.12.2020) by The Bank Recovery and Resolution and Miscellaneous Provisions (Amendment) (EU Exit) Regulations 2018 (S.I. 2018/1394), reg. 1(2), Sch. 3 para. 118(3)(b); 2020 c. 1, Sch. 5 para. 1(1)

F7 Words in Sch. 2 para. 2(e)(i) substituted (31.12.2020) by The Bank Recovery and Resolution and Miscellaneous Provisions (Amendment) (EU Exit) Regulations 2018 (S.I. 2018/1394), reg. 1(2), Sch. 3 para. 118(3)(c)(i); 2020 c. 1, Sch. 5 para. 1(1)

F8 Words in Sch. 2 para. 2(e)(i) substituted (31.12.2020) by The Bank Recovery and Resolution and Miscellaneous Provisions (Amendment) (EU Exit) Regulations 2018 (S.I. 2018/1394), reg. 1(2), Sch. 3 para. 118(3)(c)(ii); 2020 c. 1, Sch. 5 para. 1(1)

F9 Words in Sch. 2 para. 2(f) substituted (28.12.2020) by The Bank Recovery and Resolution (Amendment) (EU Exit) Regulations 2020 (S.I. 2020/1350), regs. 1(2), 59(d)

F10 Words in Sch. 2 para. 2(g) inserted (28.12.2020) by The Bank Recovery and Resolution (Amendment) (EU Exit) Regulations 2020 (S.I. 2020/1350), regs. 1(2), 59(e)

F11 Word in Sch. 2 para. 2(h) added (31.12.2020) by The Bank Recovery and Resolution and Miscellaneous Provisions (Amendment) (EU Exit) Regulations 2018 (S.I. 2018/1394), reg. 1(2), Sch. 3 para. 118(3)(d); 2020 c. 1, Sch. 5 para. 1(1)

F12 Words in Sch. 2 para. 2(i) substituted (31.12.2020) by The Bank Recovery and Resolution and Miscellaneous Provisions (Amendment) (EU Exit) Regulations 2018 (S.I. 2018/1394), reg. 1(2), Sch. 3 para. 118(3)(e)(i); 2020 c. 1, Sch. 5 para. 1(1)

F13 Word in Sch. 2 para. 2(i) omitted (31.12.2020) by virtue of The Bank Recovery and Resolution and Miscellaneous Provisions (Amendment) (EU Exit) Regulations 2018 (S.I. 2018/1394), reg. 1(2), Sch. 3 para. 118(3)(e)(ii); 2020 c. 1, Sch. 5 para. 1(1)

F14 Sch. 2 para. 2(j) omitted (31.12.2020) by virtue of The Bank Recovery and Resolution and Miscellaneous Provisions (Amendment) (EU Exit) Regulations 2018 (S.I. 2018/1394), reg. 1(2), Sch. 3 para. 118(3)(f); 2020 c. 1, Sch. 5 para. 1(1)

Marginal Citations

M2 For the meaning of “resolution” see the recovery and resolution directive, Article 2.1, point (1).

M3 For the meaning of “group resolution” see the recovery and resolution directive, Article 2.1, point (42).

F15 3.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . U.K.

Textual Amendments

F15 Sch. 2 para. 3 omitted (31.12.2020) by virtue of The Bank Recovery and Resolution and Miscellaneous Provisions (Amendment) (EU Exit) Regulations 2018 (S.I. 2018/1394), reg. 1(2), Sch. 3 para. 118(4); 2020 c. 1, Sch. 5 para. 1(1)

[F16 4.   In this Schedule, “group resolution” means— U.K.

(a) the taking of resolution action at the level of—

(i) a parent undertaking; or

(ii) an institution,

which forms part of a group that is subject to consolidated supervision in accordance with [F17 the capital requirements regulation and CRR rules]; or

(b) the co-ordination of the application of resolution tools and the exercise of resolution powers by the Bank in relation to resolution entities that meet the conditions for resolution.]

Textual Amendments

F16 Sch. 2 para. 4 added (31.12.2020) by The Bank Recovery and Resolution and Miscellaneous Provisions (Amendment) (EU Exit) Regulations 2018 (S.I. 2018/1394), reg. 1(2), Sch. 3 para. 118(5) (as amended by S.I. 2020/1350, regs. 1(2), 77(7)); 2020 c. 1, Sch. 5 para. 1(1)

F17 Words in Sch. 2 para. 4 substituted (1.1.2022) by The Financial Services Act 2021 (Prudential Regulation of Credit Institutions and Investment Firms) (Consequential Amendments and Miscellaneous Provisions) Regulations 2021 (S.I. 2021/1376), regs. 1(3), 19(14)