Bank Resolution (Recapitalisation) Act 2025

Clause 2, page 2, line 20, after “up” insert “or from the management or shareholders of the institution being sold or wound up”

Clause 2, page 2, line 20, at end insert— “(aa) on a winding up of the institution, any recapitalisation payment is to be treated as a debt of the institution and paid out of the institution’s assets in preference to all other claims except any prescribed fees or expenses of the official receiver;”

Clause 1, page 2, line 3, at end insert— “(6) When the Bank of England exercises its power in subsection (1), the Bank must make a report to the Chancellor of the Exchequer within 28 days of the date of any recapitalisation payment being made.

Clause 1, page 2, line 3, after “2009)”, insert “excluding institutions with minimum requirements for own funds and eligible liabilities on the basis of a bail-in resolution strategy as may be identified by the Bank of England from time to time.”

Clause 1, page 1, line 20, at end insert— “(2A) The Bank may not exercise the power in subsection (1) more than once in respect of the same financial institution without the consent of the Treasury.”

Clause 1, page 2, line 3, at end insert— “(6) Use of the Financial Services Compensation Scheme for bank recapitalisation and associated costs must not reduce bank depositors’ entitlement to the full amount of Deposit Guarantee Insurance.”

Clause 1, page 1, line 20, at end insert— “(2A) The Bank may not exercise the power in subsection (1) in respect of a financial institution which meets the condition in subsection (2B) without the consent of the Treasury.

Clause 1, page 1, line 20, at end insert— “(2A) The Bank may not exercise the power in subsection (1) in respect of a financial institution which meets the condition in subsection (2B) without the consent of the Treasury.

Clause 4, page 3, line 15, at end insert— “(2A) In section 4 (special resolution objectives), at the end of subsection (9) insert—

Clause 1, page 1, line 20, at end insert— “(2A) The Bank of England may only exercise the power in subsection (1) if it assesses that the use of the power would support the public interest, which may include but need not be limited by—

Clause 1, page 1, line 20, at end insert— “(2A) The Bank may not exercise the power in subsection (1) without the consent of the Treasury.”

Clause 1, page 2, line 3, at end insert— “214F Recapitalisation payments: reporting

Clause 1, page 1, line 18, leave out lines 18 to 20

Clause 1, page 1, line 8, after “institution” insert “that is not required to hold Minimum Requirement for Own Funds and Eligible Liabilities (MREL) or is below a level of total assets of value of £15 billion index linked from 1 January 2016”

Clause 1, page 1, line 22, at end insert— “(3A) Before exercising the power in subsection (1), the Bank and the scheme manager must assess whether they consider that there should be a clawback of executive pay and bonuses from the previous 12 months.”

Clause 3, page 2, line 41, at end insert— “(5C) The compensation scheme may not allow the scheme manager to impose levies on liable financial institutions in relation to recapitalisation payments under 214E in financial years following that in which the recapitalisation payments occurred without the consent of the Treasury.”

Clause 3, page 2, line 36, at end insert “nor on financial institutions that the Bank of England has directed to maintain a Minimum Requirement for Own Funds and Eligible Liabilities (MREL) or issue eligible liabilities.”

Clause 1, page 1, line 20, at end insert— “(2A) The Bank of England must not require the scheme manager to make a recapitalisation payment if it has directed the financial institution to maintain a Minimum Requirement for Own Funds and Eligible Liabilities (MREL) or issue eligible liabilities.”

Clause 1, page 2, line 3, after “2009)”, insert “that is not required to hold the Minimum Requirement for own funds and Eligible Liabilities (MREL) above minimum capital requirements.”

Clause 1, page 2, line 3, at end insert— “214F Engagement with Parliamentary Committees

Clause 1, page 2, line 3, at end insert— “(6) When the Bank exercises its power in subsection (1), the Bank must make a report to the Chancellor of the Exchequer within 28 days of the date of any recapitalisation payment being made.

After Clause 2, insert the following new Clause— “Treatment of recapitalisation payments on a winding up

[<i>Withdrawn</i>] Clause 1, page 2, line 3, at end insert—

Clause 4, page 3, line 15, at end insert— “(2A) In section 4 (special resolution objectives), after subsection (9) insert—

Clause 1, page 1, line 22, at end insert— “(3A) Before exercising the power in subsection (1), the Bank and the scheme manager must assess whether they consider that there should be a clawback of any part of executive remuneration from the previous 12 months.”

Clause 1, page 2, line 3, at end insert— “(6) As a secondary objective to the special resolution objectives in section 4 of the Banking Act 2009, when discharging its functions in respect of the exercise of recapitalisation payments under this section, the Bank of England must observe the competitiveness and growth objective.

Clause 1, page 2, line 3, at end insert— “(6) When discharging its functions in respect of the exercise of recapitalisation payments under this section, the Bank of England must observe the competitiveness and growth objective.

Clause 1, page 1, line 25, at end insert— “(4A) In subsection (2)(b), “relevant person” means—

After Clause 1, insert the following new Clause— “Notification to Parliamentary Committees

Clause 1, page 1, line 18, leave out “another” and insert “a relevant”

After Clause 2, insert the following new Clause— “Code of practice

After Clause 1, insert the following new Clause— “Reporting

After inserted subsection (5) insert— “(5A) Unless already covered by the final report under subsection (3), the Bank must make a further report to the Chancellor of the Exchequer within three months of the date of the sale to a private sector purchaser of the financial institution to which the recapitalisation payment relates, or the sale, closure or winding up of the financial institution or bridge bank to which the recapitalisation payment relates, complying with such requirements as to content as the Treasury may specify.”

Clause 1, page 1, line 20, at end insert— “(2A) The Bank of England must not require the scheme manager to make a recapitalisation payment if it has directed the financial institution to maintain an end-state Minimum Requirement for Own Funds and Eligible Liabilities (MREL) exceeding minimum capital requirements.”

In inserted subsection (3), leave out “The reference to the Treasury Committee of the House of Commons” and insert “A reference to a committee in subsection (2)”

In inserted subsection (4), at end insert “, in relation to committees of the House of Commons, and (b) the Chairman of Committees of the House of Lords, in relation to committees of the House of Lords.”

In inserted subsection (2) leave out paragraph (b) and insert— “(b) the Financial Services Regulation Committee of the House of Lords”

Clause 8, page 6, line 1, leave out subsection (5)

Clause 1, page 1, line 21, leave out subsection (3)

Clause 1, page 1, line 24, at end insert— “(3A) No application to the scheme manager for recapitalisation payments may be considered by the Bank of England for a financial institution which has been directed to maintain an end-state Minimum Requirement for Own Funds and Eligible Liabilities (MREL) exceeding minimum capital requirements, unless permission has been given, through regulations, by the Chancellor of the Exchequer.

Clause 1, page 2, line 3, at end insert— “(5A) As a further objective to the special resolution objectives in section 4 of the Banking Act 2009, when discharging its functions in respect of the exercise of recapitalisation payments under this section, the Bank of England must observe the competitiveness and growth objective.

To move the following Clause— “MREL limits in line with inflation

To move the following Clause— “Linking FSCS to inflation

To move the following Clause— “Credit Unions accessing Bank of England liquidity facilities

Clause 5, page 4, line 14, at end insert— “(2B) The code must include guidance to the Bank of England on the exercise of its functions in relation to building societies to ensure that, in circumstances where the use of a recapitalisation power may result in demutualisation, due consideration is given to the impact of such demutualisation on members and on the mutuals sector.

Clause 1, page 1, line 20, at end insert— “(2A) The Bank of England must not require the scheme manager to make a recapitalisation payment if it has directed the financial institution to maintain an end-state Minimum Requirement for Own Funds and Eligible Liabilities (MREL) exceeding minimum capital requirements.”

Clause 1, page 2, line 3, at end insert— “(5A) As a further objective to the special resolution objectives in section 4 of the Banking Act 2009, when discharging its functions in respect of the exercise of recapitalisation payments under this section, the Bank of England must observe the competitiveness and growth objective.

Clause 1, page 1, line 22, at end insert— “(3A) No application to the scheme manager for recapitalisation payments may be considered by the Bank of England for a financial institution which has been directed to maintain an end-state Minimum Requirement for Own Funds and Eligible Liabilities (MREL) exceeding minimum capital requirements, unless permission has been given, through regulations, by the Chancellor of the Exchequer.