Search Legislation

The Bank Recovery and Resolution and Miscellaneous Provisions (Amendment) (EU Exit) Regulations 2018

Status:

This is the original version (as it was originally made). This item of legislation is currently only available in its original format.

Requirements concerning recovery plans

This section has no associated Explanatory Memorandum

116.  Before Schedule 1 insert—

Articles 7(3), 13(1) & 19(2)

SCHEDULE A1Information to be contained in a recovery plan or group recovery plan

1.  In this Schedule—

(a)“entity” means, in relation to the drawing up of —

(i)a recovery plan for an institution, the institution;

(ii)a group recovery plan for a relevant group, the group entities;

(b)except where provision is made to the contrary, “plan” means a recovery plan or a group recovery plan.

2.  A plan must include—

(a)a summary of its key elements and a summary of the overall capacity of the entity to restore its financial position following a significant deterioration;

(b)a summary of any material changes to the entity, including any change to its legal or organisational structure or its business or financial position, which has occurred since the date on which the plan was last revised;

(c)a communication and disclosure plan outlining how the entity intends to manage any potentially negative market reactions;

(d)a range of capital and liquidity actions required to maintain or restore the viability and financial position of the entity;

(e)an estimation of the time required for the execution of each material aspect of the plan;

(f)a detailed description of any material impediment to the effective and timely execution of the plan, including consideration of the impact on the rest of the group (where applicable), customers and counterparties;

(g)identification of critical functions;

(h)a detailed description of the processes for determining the value and marketability of the core business lines, operations and assets of the entity;

(i)a detailed description of how recovery planning is integrated into the corporate governance structure of the entity as well as the policies and procedures governing the approval of the plan and identification of the persons in the organisation responsible for preparing and implementing the plan;

(j)arrangements and measures to conserve or restore the entity’s own funds;

(k)arrangements and measures to ensure that the entity has adequate access to contingency funding sources, including potential liquidity sources, an assessment of available collateral and an assessment of the possibility of transferring liquidity across group entities and business lines, to ensure that it can continue to carry out its operations and meet its obligations as they fall due;

(l)arrangements and measures to reduce risk and leverage;

(m)arrangements and measures to restructure liabilities;

(n)arrangements and measures to restructure business lines;

(o)arrangements and measures necessary to maintain continuous access to financial markets infrastructures;

(p)arrangements and measures necessary to maintain the continuous functions of the entity’s operational processes, including infrastructure and information technology services;

(q)preparatory arrangements to facilitate the sale of assets or business lines in a time-frame appropriate for the restoration of financial soundness;

(r)any other management actions or strategies to restore financial soundness and the anticipated financial effect of those actions or strategies;

(s)preparatory measures that the entity has taken or plans to take in order to facilitate the implementation of the plan, including those necessary to enable the timely recapitalisation of the entity;

(t)a framework of indicators which identifies the points at which appropriate actions referred to in the plan may be taken.

3.  The plan must provide for measures to be taken by the entity to restore its financial position following a significant deterioration of its financial situation.

4.  In drawing up the plan the entity must not assume any access to or receipt of extraordinary public financial support.

5.  The plan must include, where applicable, an analysis of the conditions under which the entity may apply for the use of the Bank’s facilities.

6.  The analysis must identify the assets of the entity which would be expected to qualify as collateral for the use of the Bank’s facilities.

7.  The plan must include possible measures which could be taken by the entity where the conditions for early intervention are met.

8.  The plan must include appropriate conditions and procedures to ensure the timely implementation of recovery actions as well as a wide range of recovery options.

9.  The plan must contemplate a range of scenarios of severe macroeconomic and financial stress relevant to the entity’s specific conditions including system-wide events and stress specific to individual legal persons and to groups.

10.  The plan must provide evidence that the management body of the entity has assessed and approved it before submitting it to the appropriate regulator.

11.  The plan must include an appropriate framework of indicators established by the entity which identifies the points at which appropriate actions referred to in the plan may be taken.

12.  The indicators may be of a qualitative or quantitative nature relating to the entity’s financial position and shall be capable of being monitored easily.

13.  The plan must provide details of appropriate arrangements which the entity has put in place for the regular monitoring of the indicators.

14.  An entity may—

(a)take action under its plan where the relevant indicator has not been met, but where the management body of the entity considers action to be appropriate in the circumstances; or

(b)refrain from taking such an action where the relevant indicator has been met, but the management body of the entity does not consider action to be appropriate in the circumstances.

15.  The entity must without delay notify the appropriate regulator of a decision under paragraph 14(a) or (b)..

Back to top

Options/Help

Print Options

You have chosen to open The Whole Instrument

The Whole Instrument you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.

Would you like to continue?

You have chosen to open The Whole Instrument as a PDF

The Whole Instrument you have selected contains over 200 provisions and might take some time to download.

Would you like to continue?

You have chosen to open the Whole Instrument

The Whole Instrument you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.

Would you like to continue?

You have chosen to open Schedules only

The Schedules you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.

Would you like to continue?

Close

Legislation is available in different versions:

Latest Available (revised):The latest available updated version of the legislation incorporating changes made by subsequent legislation and applied by our editorial team. Changes we have not yet applied to the text, can be found in the ‘Changes to Legislation’ area.

Original (As Enacted or Made):The original version of the legislation as it stood when it was enacted or made. No changes have been applied to the text.

Close

Opening Options

Different options to open legislation in order to view more content on screen at once

Close

Explanatory Memorandum

Explanatory Memorandum sets out a brief statement of the purpose of a Statutory Instrument and provides information about its policy objective and policy implications. They aim to make the Statutory Instrument accessible to readers who are not legally qualified and accompany any Statutory Instrument or Draft Statutory Instrument laid before Parliament from June 2004 onwards.

Close

More Resources

Access essential accompanying documents and information for this legislation item from this tab. Dependent on the legislation item being viewed this may include:

  • the original print PDF of the as enacted version that was used for the print copy
  • lists of changes made by and/or affecting this legislation item
  • confers power and blanket amendment details
  • all formats of all associated documents
  • correction slips
  • links to related legislation and further information resources
Close

Impact Assessments

Impact Assessments generally accompany all UK Government interventions of a regulatory nature that affect the private sector, civil society organisations and public services. They apply regardless of whether the regulation originates from a domestic or international source and can accompany primary (Acts etc) and secondary legislation (SIs). An Impact Assessment allows those with an interest in the policy area to understand:

  • Why the government is proposing to intervene;
  • The main options the government is considering, and which one is preferred;
  • How and to what extent new policies may impact on them; and,
  • The estimated costs and benefits of proposed measures.
Close

More Resources

Use this menu to access essential accompanying documents and information for this legislation item. Dependent on the legislation item being viewed this may include:

  • the original print PDF of the as made version that was used for the print copy
  • correction slips

Click 'View More' or select 'More Resources' tab for additional information including:

  • lists of changes made by and/or affecting this legislation item
  • confers power and blanket amendment details
  • all formats of all associated documents
  • links to related legislation and further information resources