# The Bank Administration (England and Wales) (Amendment) Rules 2010, Article 15: Amendments to the Bank Administration (England and Wales) Rules 2009


After rule 47, insert—
“Disapplication of set-off for protected deposits
47A. (1) This rule applies if—
(a) FSA Rules allow the FSCS to make gross payments of compensation in respect of protected deposits; and
(b) all or part of a creditor’s claim against the bank is in respect of protected deposits.
(2) Rule 2.85 of the Insolvency Rules 1986 shall apply, but for the purpose of determining the sums due from the bank to an eligible depositor in respect of protected deposits under rule 2.85(3)—
(a) where the total of the sums held by the bank for the depositor in respect of protected deposits is no more than the amount prescribed as the maximum compensation payable in respect of protected deposits under Part 15 of the Financial Services and Markets Act 2000 (“the limit”), then paragraph (3) applies; and
(b) where the sums held exceed the limit, then paragraph (4) applies.
(3) Where this paragraph applies, there shall be deemed to have been no mutual dealings, regardless of whether there are any sums due from the depositor to the bank, and the sum due to the depositor from the bank will be the total of the sums held by the bank for that depositor in respect of the protected deposits.
(4) Where this paragraph applies then—
(a) any mutual dealings shall be treated as being mutual dealings only in relation to the amount by which the total of the sums due to the depositor exceeds the limit, and
(b) the sums due from the bank to the depositor in respect of the protected deposits will be—
(i) the amount by which that total exceeds the limit, set off against the amounts due to the bank from the depositor in accordance with rule 2.85(3); and
(ii) the sums held by the bank for the depositor in respect of protected deposits up to the limit.
(5) Any arrangements with regard to set-off between the bank and the eligible depositor in existence before the date of the notice referred to in rule 2.85(1) shall be subject to this rule in so far as they relate to protected deposits.
(6) In this rule—
“eligible depositor” has the meaning given to it by section 93(3) of the Banking Act 2009;
“FSA Rules” means the FSA’s Compensation Sourcebook, as amended from time to time, made under section 213 of the Financial Services and Markets Act 2000; and
“protected deposit” means a protected deposit within the meaning given by the FSA Rules held by the bank at the date of the notice referred to in rule 2.85(1).”.

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Source: https://www.legislation.gov.uk/uksi/2010/2583/article/15 (the official version)
Page: https://openlegislation.uk/bank-administration-england-and-wales-amendment-rules-2010/article-15
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.