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Part 1U.K.Special Resolution Regime

Modifications etc. (not altering text)

[F1Chapter 1U.K. Introduction]

Textual Amendments

F1Pt. 1 Ch. 1 formed from ss. 1-3 (1.1.2015) by The Bank Recovery and Resolution Order 2014 (S.I. 2014/3329), arts. 1(2), 3

1OverviewU.K.

(1)The purpose of the special resolution regime for banks is to address the situation where all or part of the business of a bank has encountered, or is likely to encounter, financial difficulties.

(2)The special resolution regime consists of—

(a)the [F2five] stabilisation options,

(b)the bank insolvency procedure (provided by Part 2), and

(c)the bank administration procedure (provided by Part 3).

[F3(3)The [F4five] “stabilisation options” are—

(a)transfer to a private sector purchaser (section 11),

(b)transfer to a bridge bank (section 12),

[F5(ba)transfer to an asset management vehicle (section 12ZA),]

(c)the bail-in option (section 12A), and

(d)transfer to temporary public ownership (section 13).]

(4)Each of the [F6five] stabilisation options is achieved through the exercise of one or more of the “stabilisation powers”, which are—

[F7(za)the resolution instrument powers (sections 12A(2) and 48U to 48W),]

(a)the share transfer powers (sections 15, 16, 26 to 31 and 85), and

(b)the property transfer powers (sections 33[F8, 41A] and 42 to 46).

[F9(c)the third country instrument powers (sections 89H to 89J).]

(5)Each of the following has a role in the operation of the special resolution regime—

(a)the Bank of England,

(b)the Treasury,

[F10(c)the Prudential Regulation Authority, and

(d)the Financial Conduct Authority.]

(6)The Table describes the provisions of this Part.

SectionsTopic
Sections 1 to 3Introduction
[F11Sections 3A and 3B] [F11Pre-resolution powers]
Sections 4 to 6Objectives and code
[F11Sections 6A to 6D] [F11Mandatory write-down, conversion etc of capital instruments]
[F11Section 6E] [F11Valuation before mandatory write-down or stabilisation action]
Sections 7 to 10Exercise of powers: general
Sections 11 to 13The stabilisation options
Sections 14 to 32Transfer of securities
Sections 33 to [F1248A]Transfer of property
[F11Sections 48B to [F1348WA]] [F11Bail-in option]
[F11Sections 48X and 48Y] [F11Replacement of provisional valuation]
[F11Section 48Z] [F11Termination rights etc]
Sections 49 to 62Compensation
[F11Section 62A] [F11Independent valuer]
[F11Sections 62B to 62E] [F11Resolution administrator]
Sections 63 to 75Incidental functions
Sections 76 to [F1481A]Treasury
[F15Sections 81B to 83] [F15Groups]
[F11Sections 83ZA to 83Z2] [F11Information and enforcement]
[F16Section 83A][F16Banks not regulated by the PRA]
Sections 84 to 89Building societies, &c.
[F17Section 89A] [F17Investment firms]
F18. . .F18. . .
[F11Sections 89H to 89J] [F11Third-country resolution actions]
[F19Section 89JA Resolution of UK branches of third-country institutions]

Textual Amendments

F10S. 1(5)(c)(d) substituted for s. 1(5)(c) (1.4.2013) by Financial Services Act 2012 (c. 21), s. 122(3), Sch. 17 para. 2(2) (with Sch. 20); S.I. 2013/423, art. 3, Sch.

F12Word in s. 1(6) substituted (8.4.2010) by Financial Services Act 2010 (c. 28), s. 26(1)(l), Sch. 2 para. 40

F14Word in s. 1(6) substituted (1.1.2015) by Financial Services Act 2012 (c. 21), ss. 99(3), 122(3) (with Sch. 20); S.I. 2014/3323, art. 2

F15Words in s 1(6) substituted (1.8.2014) by Financial Services Act 2012 (c. 21), ss. 100(2), 122(3) (with Sch. 20); S.I. 2014/1847, art. 2

F17Words in s 1(6) inserted (1.8.2014) by Financial Services Act 2012 (c. 21), ss. 101(2), 122(3) (with Sch. 20); S.I. 2014/1847, art. 2

Commencement Information

I1S. 1 in force at 21.2.2009 by S.I. 2009/296, art. 3, Sch. para. 1