Part XV

The Financial Services Compensation Scheme

Provisions of the scheme

Recapitalisation payments
214E
1
The Bank of England may require the scheme manager to make a recapitalisation payment to the Bank or another person where the Bank has exercised or decided to exercise a stabilisation power under Part 1 of the Banking Act 2009 in respect of a financial institution so as to achieve—
a
a sale of the institution to a private sector purchaser (see section 11 of that Act), or
b
a transfer of the institution to a bridge bank (see section 12 of that Act).
2
A recapitalisation payment is a payment in respect of the Bank’s estimate of—
a
the costs likely to be required for the recapitalisation of the financial institution, and
b
any other expenses that the Bank or a relevant person has incurred or might incur in connection with the recapitalisation of the institution or the exercise of the stabilisation power.
3
Before exercising the power in subsection (1), the Bank must consult the scheme manager.
4
A recapitalisation payment made by the scheme manager under subsection (1) is to be treated for the purposes of this Part as an expense under the compensation scheme.
5
In subsection (2)(b), “
relevant person
” means—
a
the Treasury,
b
a bridge bank, or
c
an asset management vehicle.
6
In this section, “bridge bank” and “asset management vehicle” have the meanings given by sections 12 and 12ZA, respectively, of the Banking Act 2009.
7
In this section and in section 214H, “
financial institution
” means a bank, building society or investment firm (within the meanings of Part 1 of the Banking Act 2009).
Pt. XV (ss. 212-224) excluded (27.4.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (S.I. 2001/544), art. 9J (as inserted by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2002 (S.I. 2002/682), arts. 1(2), 4)
Pt. XV (ss. 212-224) modified (2.7.2002) by The Financial Services and Markets Act 2000 (Consequential Amendments and Transitional Provisions) (Credit Unions) Order 2002 (S.I. 2002/1501), art. 5
Pt. 15 modified (29.9.2008 at 8.00 a.m.) by The Bradford & Bingley plc Transfer of Securities and Property etc. Order 2008 (S.I. 2008/2546), art. 29 (with art. 30(6))
Pt. 15 modified (7.10.2008 at 9.30 a.m.) by The Heritable Bank plc Transfer of Certain Rights and Liabilities Order 2008 (S.I. 2008/2644), art. 14 (with art. 15(8)
Pt. 15 modified (8.10.2008 at 12.15 p.m.) by The Kaupthing Singer & Friedlander Limited Transfer of Certain Rights and Liabilities Order 2008 (S.I. 2008/2674), art. 15 (with art. 16(8))
S. 214E inserted (16.7.2025) by Bank Resolution (Recapitalisation) Act 2025 (c. 15), ss. 1, 8(2); S.I. 2025/872, reg. 2(a)