SCHEDULES
SCHEDULE 2Bail-in stabilisation option
PART 1Amendments of Banking Act 2009
Other amendments of the Act
I112
1
Section 1 (overview) is amended as follows.
2
In subsection (2)(a), for “three” substitute “
four
”
.
3
For subsection (3) substitute—
3
The four “stabilisation options” are—
a
transfer to a private sector purchaser (section 11),
b
transfer to a bridge bank (section 12),
c
the bail-in option (section 12A), and
d
transfer to temporary public ownership (section 13).
4
In subsection (4)—
a
for “three” substitute “
four
”
;
b
before paragraph (a) insert—
za
the resolution instrument powers (sections 12A(2) and 48U to 48W),
c
in paragraph (b), after “33” insert “
, 41A
”
.
I213
In section 13 (temporary public ownership), in subsection (1), for “third” substitute “
fourth
”
.
I314
In section 17 (share transfers: effect)—
a
in subsection (1), after “order” insert, “
or by a resolution instrument
”
;
b
in subsection (5), after “order” insert “
or a resolution instrument
”
;
c
in subsection (6), after “order” insert “
or a resolution instrument
”
.
I415
In section 18 (share transfers: continuity), after subsection (5) insert—
6
This section applies to a resolution instrument as it applies to a share transfer instrument; and in relation to a resolution instrument references in this section to a “transfer” are to a transfer of securities (whether made by that or another resolution instrument) and “transferor” and “transferee” are to be read accordingly.
I516
In section 44 (reverse property transfer)—
a
in subsection (2), after “more” insert “
bridge bank
”
;
b
in subsection (3), after “more” insert “
bridge bank
”
;
c
in subsection (4), for “A reverse” substitute “
A bridge bank reverse
”
;
d
in subsection (4A)—
i
after “make a” insert “
bridge bank
”
, and
ii
in paragraph (b), for “the reverse” substitute “
the bridge bank reverse
”
;
e
in subsection (5), for “a reverse” substitute “
a bridge bank reverse
”
;
f
in subsection (6), for “a reverse” substitute “
a bridge bank reverse
”
;
g
in subsection (7), for “a reverse” substitute “
a bridge bank reverse
”
;
h
in the heading, for “Reverse” substitute “
Bridge bank: reverse
”
.
I617
In section 63 (general continuity obligation: property transfers), in subsection (1)(a), for “or 12(2)” substitute “
, 12(2) or 41A(2)
”
.
I718
In section 66 (general continuity obligation: share transfers)—
a
in subsection (1)(a), after “13(2)” insert “
, or which falls within subsection (1A)
”
;
b
in subsection (1)(d)(i), after “11(2)(a)” insert “
, or in a case falling within subsection (1A)
”
;
c
after subsection (1) insert—
1A
A bank falls within this subsection if a resolution instrument (or supplemental resolution instrument) has changed the ownership of the bank (wholly or partly) by providing for the transfer, cancellation or conversion from one form or class to another of securities issued by the bank (and the reference in subsection (1)(b) to “the transfer” includes such a cancellation or conversion).
I819
In section 67 (special continuity obligation: share transfers), in subsection (4)(c), after “order” insert “
or resolution instrument
”
.
I920
In section 68 (continuity obligations: onward share transfers), in subsection (1)(a), after “transferred by” insert “
a resolution instrument under section 12A(2) or supplemental resolution instrument under section 48U(2) or a
”
.
I1021
In section 71 (pensions), in subsection (1)—
a
omit the “and” at the end of paragraph (b);
b
after paragraph (c) insert
, and
d
resolution instruments.
I1122
In section 72 (enforcement), in subsection (1)—
a
omit the “or” at the end of paragraph (b);
b
after paragraph (c) insert
, or
d
a resolution instrument.
I1223
In section 73 (disputes), in subsection (1)—
a
omit the “and” at the end of paragraph (b);
b
after paragraph (c) insert
, and
d
resolution instruments.
I1324
In section 74 (tax), in subsection (6), for “or 45” substitute “
, 45, 48U or 48V
”
.
I1425
After section 80 insert—
80ATransfer for bail-in purposes: report
1
This section applies where the Bank of England makes one or more resolution instruments under section 12A(2) in respect of a bank.
2
The Bank of England must, on request by the Treasury, report to the Chancellor of the Exchequer about—
a
the exercise of the power to make a resolution instrument under section 12A(2),
b
the activities of the bank, and
c
any other matters in relation to the bank that the Treasury may specify.
3
In relation to the matters in subsection (2)(a) and (b), the report must comply with any requirements that the Treasury may specify.
4
The Chancellor of the Exchequer must lay a copy of each report under subsection (2) before Parliament.
I1526
In section 81A (accounting information to be included in reports under sections 80 and 81)—
a
in subsection (1), for “or 81” substitute “
, 80A(2)(b) or 81
”
;
b
in the heading, for “and 81” substitute “
, 80A(2)(b) and 81
”
.
I1627
In section 85 (temporary public ownership), in subsection (1), for “third” substitute “
fourth
”
.
I1728
In section 136 (overview), in the Table in subsection (3), for “152” substitute “
152A
”
.
I1829
After section 152 insert—
152AProperty transfer from transferred institution
1
This section applies where the Bank of England—
a
makes a resolution instrument that transfers securities issued by a bank (or a bank's parent undertaking), in accordance with section 12A(2), and
b
later makes a property transfer instrument from the bank or from another bank which is or was in the same group as the bank, in accordance with section 41A(2).
2
This Part applies to the transferor under the property transfer instrument made in accordance with section 41A(2) as to the transferor under a property transfer instrument made in accordance with section 12(2).
3
For that purpose this Part applies with any modifications specified by the Treasury in regulations; and any regulations—
a
are to be made by statutory instrument, and
b
may not be made unless a draft has been laid before and approved by resolution of each House of Parliament.
I1930
In section 220 (insolvency etc), after subsection (4) insert—
4A
The fact that ownership of an authorised bank is transferred or otherwise changed as a result of a resolution instrument (or an instrument treated as a resolution instrument) does not itself prevent the bank from relying on section 213.
I2031
In section 259 (statutory instruments)—
a
in the Table in subsection (3), in Part 1, in the entry relating to section 60 for “Third party compensation” substitute “
Third party compensation: partial property transfers
”
;
b
in the Table in subsection (3), in Part 1, at the appropriate places insert—
48F(1) and (2)
Power to amend definition of “excluded liabilities”
Draft affirmative resolution
48G
Insolvency treatment principles
Draft affirmative resolution
48P
Safeguarding of certain financial arrangements
Draft affirmative resolution
52A
Bail-in compensation orders
Draft affirmative resolution”
“60A
Third party compensation: instruments containing special bail-in provision
Draft affirmative resolution
c
in the Table in subsection (3), in Part 3, at the appropriate place insert—
152A
Property transfer from transferred institution
Draft affirmative resolution
d
in subsection (5), after paragraph (d) insert—
da
section 60A (special resolution regime: instruments containing special bail-in provision),
e
in subsection (5), after paragraph (k) insert—
ka
section 152A (bank administration: property transfer from transferred institution),
I2132
In section 261 (index of defined terms), in the Table, at the appropriate places insert—
Bail-in compensation order
49”
“Resolution instrument
12A”
“Special bail-in provision
48B