Banking Act 2009

Part 1Special Resolution Regime

Chapter 1Introduction

2Interpretation: “bank”

3Interpretation: other expressions

Chapter 2Pre-resolution powers of the Bank of England

3ARemoval of impediments to the exercise of stabilisation powers etc

3BSafeguards relating to directions under section 3A

Chapter 3Special resolution action

Objectives and code

4Special resolution objectives

5Code of practice

6Code of practice: procedure

Mandatory write-down, conversion etc of capital instruments

6ACases where mandatory write-down, conversion, etc applies

6BMandatory write-down, conversion, etc of capital instruments and liabilities

6CMandatory reduction instruments: implementation of requirements of section 6B

6DMandatory reduction instruments: supplementary matters

Valuation before mandatory write-down of capital or stabilisation action

6EPre-resolution valuation

Exercise of powers: general

7General conditions

7AEffect on other group members, financial stability in UK etc

8Specific Condition: private sector purchaser, bridge bank or asset management vehicle

8ZASpecific conditions: asset management vehicle

8ASpecific condition: bail-in

9Specific conditions: temporary public ownership

10Banking Liaison Panel

The stabilisation options

11Private sector purchaser

11APrivate sector purchaser: marketing

12ZAAsset management vehicle

12ABail-in option

12AABail-in: sequence of write-down and conversion of capital instruments and liabilities

12BBail-in administrators

13Temporary public ownership

Transfer of securities

14Interpretation: “securities”

15Share transfer instrument

16Share transfer order

19Conversion and delisting

20Directors and senior managers

21Ancillary instruments: production, registration, &c.

22Termination rights, &c.

23Incidental provision

24Procedure: instruments

25Procedure: orders

26Supplemental instruments

26ZAOnward share transfer instruments

26A... reverse share transfer instruments

27Supplemental orders

28Onward transfer

29Reverse share transfer orders

29AInterpretation: “resolution company”

30Resolution company: share transfers

31Resolution company: reverse share transfer

32Interpretation: general

Transfer of property

33Property transfer instrument

35Transferable property

36ADirectors and senior managers

38Termination rights, &c.

39Foreign property

39ABanks which are recognised central counterparties

39BProperty transfer instrument: delisting

40Incidental provision

41ATransfer of property subsequent to resolution instrument

42Supplemental instruments

42APrivate sector purchaser: reverse property transfer

43Onward transfer

44Resolution company: reverse property transfer

44ABail in: reverse property transfer

44BProperty transfer instruments: special bail-in provision

44BAProperty transfer instruments and special bail-in provision: supplementary matters

44CReport on special bail-in provision

44DBridge bank: supplemental property transfer powers

44EBridge bank: supplemental reverse property transfer powers

45Temporary public ownership: property transfer

46Temporary public ownership: reverse property transfer

47Restriction of partial transfers

48Power to protect certain interests

48ACreation of liabilities

48BSpecial bail-in provision

48CMeaning of “protected deposit”

48DGeneral interpretation of section 48B

48EReport on special bail-in provision

48FPower to amend definition of “excluded liabilities”

48GPriority between creditors

48HBusiness reorganisation plans

48IBail-in administrator: further functions

48JBail-in administrator: supplementary

48KBail-in administrator: money

48LPowers in relation to securities

48MTermination rights, etc

48NDirectors and senior managers

48ODirections in or under resolution instrument

48POrders for safeguarding certain financial arrangements

48RExecution and registration of instruments etc

48SResolution instruments: general matters

48USupplemental resolution instruments

48VOnward transfer

48WReverse transfer

48WABail-in option: recovery of expenses

Replacement of provisional valuation

48XReplacement of Bank’s provisional valuation

48YConsequences of a replacement valuation

Termination rights etc

48ZTermination rights etc

50Sale to private sector purchaser

51Transfer to temporary public ownership

52Transfer to resolution company

52ABail-in option

53Onward and reverse transfers etc

54Independent valuer: compensation scheme order or bail-in compensation order

55Independent valuer: supplemental

56Independent valuer: money

57Valuation principles

58Resolution fund

59Third party compensation: discretionary provision

60Third party compensation: mandatory provision

60AFurther mandatory provision: bail-in provision

60BPrinciple of no less favourable treatment

61Sources of compensation

Independent valuer: valuation under section 6E or 48X

62AIndependent valuer: sections 6E and 48X

Resolution administrator

62BResolution administrator

62CResolution administrator: further functions

62DResolution administrator: supplementary

62EResolution administrator: money

Incidental functions

63General continuity obligation: property transfers

64Special continuity obligations: property transfers

65Continuity obligations: onward property transfers

66General continuity obligation: share transfers

67Special continuity obligations: share transfers

68Continuity obligations: onward share transfers

69Continuity obligations: consideration and terms

70Continuity obligations: termination

70ASuspension of obligations

70BRestriction of security interests

70CSuspension of termination rights

70DSuspension: general provisions

75Power to change law

76International obligation notice: general

77International obligation notice: resolution company

78Public funds: general

78APre-conditions for financial assistance: duty of Bank to give information

79Public funds: resolution company

79APrivate sector purchaser: report

80Resolution company: report

80ATransfer for bail-in purposes: report

81Temporary public ownership: report

81AAccounting information to be included in reports under sections 80, 80A(2)(b) and 81

81AACases where mandatory write-down, conversion etc applies: banking group companies

81BSale to commercial purchaser and transfer to bridge bank

81ZZBASale to commercial purchaser and transfer to bridge bank: supplemental powers in relation to certain holding companies

81ZZBBAssessment of conditions for section 81ZZBA

81ZBATransfer to asset management vehicle

81ZBBTransfer to asset management vehicle: supplemental powers in relation to certain holding companies

81ZBCAssessment of conditions for section 81ZBB

81BABail-in option

81BBBail-in option: supplemental powers in relation to certain holding companies

81BCAssessment of conditions for section 81BB

81CSections 81AA to 81ZBB: supplemental

81CASection 81BA and Section 81BB: supplemental

81DInterpretation: “banking group company” &c.

82Temporary public ownership

Chapter 4Information, investigation and enforcement

Powers to gather information

83ZAInformation

83ZBReports by skilled persons

Appointment of investigators

83ZCAppointment of persons to carry out general investigations

83ZDAppointment of person to carry out investigations in particular cases

83ZEInvestigations etc in support of foreign resolution authorities

Conduct of investigations

83ZFInvestigations: general

83ZGPowers of persons appointed under section 83ZC

83ZHPowers of persons appointed as a result of section 83ZD

83ZIAdmissibility of statements made to investigators

Information and documents: supplemental provision

83ZJInformation and documents: supplemental provision

83ZKProtected items

83ZLEntry of premises under warrant

83ZMRetention of documents obtained under section 83ZL

83ZNOffences etc

83ZOProsecution of offences under section 83ZN

83ZPOffences under section 83ZN by bodies corporate etc

Enforcement of relevant requirements

83ZQInjunctions: prevent failure to comply with relevant requirement

83ZRRegulatory sanctions

83ZSDetermination of sanctions

83ZTProcedure: warning notice

83ZUProcedure: decision notice

83ZVProcedure: general

83ZXInjunctions: failure to comply with certain section 83ZR sanctions

83ZYPublication

83ZZCo-operation

83Z1Delegation of enforcement functions

Enforcement of share transfer orders

83Z2Enforcement: share transfer orders

Chapter 5Special cases

Banks not regulated by PRA

83AModifications of Part

Building societies, &c.

84Application of Part 1: general

84ZABridge bank: share transfer instruments

84ABail-in option: building societies

84BFurther provision: conversion of building society into company

84CFurther provision: transfer of business of building society to company

84DTransfer to a bridge bank or Bail-in option: modifications of this Act and other legislation

85Temporary public ownership

86Distribution of assets on dissolution or winding up

87Interpretation

88Consequential provision

89Credit unions

Investment firms

89AApplication to investment firms

89BApplication to recognised central counterparties

89CRecognised central counterparty rules

89DRecognised central counterparty membership

89ERecognition of transferee company

89FRecognised central counterparty compensation orders

89GInterpretation: “recognised central counterparty” &c.

Chapter 6Third-country resolution actions

Third-country resolution actions

89HRecognition of third-country resolution actions

89IEffect of recognition of third-country resolution action by Bank of England

89JThird-country instruments: supplementary provision

Chapter 6ARESOLUTION OF UK BRANCHES OF THIRD-COUNTRY INSTITUTIONS

89JAResolution of UK branches of third-country institutions

Chapter 7General provisions

89KInsolvency Proceedings

89LRestrictions on disclosure of confidential information

89MGiving of notices, documents etc under Part 1

Part 2Bank Insolvency

91Interpretation: “bank”

92Interpretation: “the court”

93Interpretation: other expressions

Bank insolvency order

96Grounds for applying

97Grounds for making

Process of bank liquidation

100Liquidation committee

101Liquidation committee: supplemental

102Objective 1: (a) or (b)?

103General powers, duties and effect

104Additional general powers

105Status of bank liquidator

Tenure of bank liquidator

106Term of appointment

108Removal by court

109Removal by creditors

110Disqualification

Termination of process, &c.

113Company voluntary arrangement

114Administration

116Dissolution: supplemental

Other processes

117Bank insolvency as alternative order

118Voluntary winding-up

119Exclusion of other procedures

120Notice to PRA of preliminary steps

120ANotice to the regulators and the Bank of England of preliminary steps

121Disqualification of directors

122Application of insolvency law

123Role of FSCS

124Transfer of accounts

127Insolvency Services Account

129Co-operation between courts

129ABanks not regulated by PRA

130Building societies

131Credit unions

132Partnerships

133Scottish partnerships

134Northern Ireland

135Consequential provision

Part 3Bank Administration

138Objective 1: supporting private sector purchaser or resolution company

139Objective 1: duration

140Objective 2: “normal” administration

141Bank administration order

143Grounds for applying

144Grounds for making

145General powers, duties and effect

145APower to direct bank administrator

146Status of bank administrator

147Administrator's proposals

148Sharing information

Multiple transfers

149General application of this Part

150Resolution company to private purchaser

151Property transfer from resolution company

152Property transfer from temporary public ownership

152AProperty transfer from transferred institution

153Successful rescue

154Winding-up or voluntary arrangement

155Disqualification of directors

156Application of other law

157Other processes

157ABanks not regulated by PRA

158Building societies

159Credit unions

159AApplication to investment firms

163Partnerships

164Scottish partnerships

165Co-operation between courts

166Interpretation: general

167Northern Ireland

168Consequential provision

Part 4Financial Services Compensation Scheme

170Contingency funding

171Special resolution regime

172Investing in National Loans Fund

173Borrowing from National Loans Fund

174Procedure for claims

175Rights in insolvency

177Payments in error

179Delegation of functions

180Functions under this Act

Part 5... Payment Systems and service providers

182Interpretation: ... key terms

183Interpretation: other expressions

Recognised systems and service providers

184Recognition order : payment system

184ARecognition order: DSA service provider

185Recognition criteria : payment system

185ARecognition criteria: DSA service provider

186AAmendment of recognition order

187De-recognition

189Codes of practice

190System rules

190AService provider rules

192Role of FCA and PRA

192APower of Bank to require FCA to refrain from specified action

194Inspection: warrant

195Independent report

196Compliance failure

200Management disqualification

202AInjunctions

203BAnnual report

203CPolicy statement

205Pretending to be recognised

206Saving for informal oversight

206AService providers

206AAService providers connected with a recognised payment system that uses digital settlement assets

206BInternational obligations

PART 5AWholesale cash distribution

206COverview and purpose

206DPolicy statement

206EInterpretation: “wholesale cash distribution”

206FInterpretation: other terms

Recognised persons

206GWholesale cash oversight orders

206H“Market significance” and “systemic significance”

206JAmendment or revocation of a wholesale cash oversight order

206LCodes of practice

206NRole of the FCA, PRA and Payment Systems Regulator

206PInspection: warrant

206QIndependent report

206RCompliance failure

206SPublication

206VManagement disqualification

206YInjunctions

206Z2Annual report

206Z3Requirement to provide information

206Z4Disclosure of information

206Z5Saving for informal oversight

Companies wholly owned by the Crown

206Z6Power to disapply regulation and enforcement provisions

Part 6Banknotes: Scotland and Northern Ireland

208“Banknote”

210“Authorised bank”

211“Commencement”

Authorisation to issue

212Repeal of old authorising enactments

213Authorisation to issue banknotes

214Consequential repeals and amendments

214APower to designate banks as “authorised banks”

Regulations and rules

215Banknote regulations

216Banknote rules

Specific issues

217Backing assets

219Ceasing the business of issuing notes

220Insolvency, &c.

221Offence: unlawful issue

222Financial penalty

223Termination of right to issue

224Application to court

Bank of England

225Organisation

226Discretionary functions

Part 7Miscellaneous

Treasury support for banks

228Consolidated Fund

229National Loans Fund

230“Financial institution”

Investment banks

233Insolvency regulations

234Regulations: details

235Regulations: procedure

Banking (Special Provisions) Act 2008

237Compensation: valuer

Bank of England

238UK financial stability

239Number of directors

241Chair of court

245Weekly return

247Bank of England Act 1946

Financial Services Authority

248Variation of permission

251Financial assistance to building societies

252Registration of charges

253Registration of charges: Scotland

Funds attached rule (Scotland)

254Abolition for cheques

Financial collateral arrangements

256Supplemental

256BBank of England” and “Prudential Regulation Authority”

257“Financial assistance”

258“Enactment”

258AInvestment firm”

259Statutory instruments

261Index of defined terms

263Commencement

Banking Act 2009

2009 c. 1

An Act to make provision about banking.

[12th February 2009]

Be it enacted by the Queen's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—C1

Annotations:

Modifications etc. (not altering text)

C1

Act: power to apply (with modifications) conferred (29.8.2023) by Financial Services and Markets Act 2023 (c. 29), s. 86(3), Sch. 11 para. 165; S.I. 2023/779, reg. 4(ddd)(xiv)