Regulation 2 Amendments to the Bank Recovery and Resolution (No. 2) Order 2014

(1)

The Bank Recovery and Resolution (No. 2) Order 2014^f1 is amended as follows.

(2)

In article 121 (interpretation of Chapter 1), after paragraph (2), insert—

“(3)

In this Chapter, references to the “minimum requirement for own funds and eligible liabilities” include any transitional minimum requirement which the Bank determines that an institution is required to hold in accordance with article 123(1C)^f2.”.

(3)

In article 123 (determination of minimum requirement)—

(a)

after paragraph (1), insert—

“(1A)

The Bank may determine a transitional period for a relevant institution, during which time a transitional minimum requirement applies.

(1B)

The Bank may amend or revoke a determination under paragraph (1A), or determine a further transitional period in relation to a relevant institution, at any time including where a previous transitional period has expired.

(1C)

Where the Bank determines a transitional period under paragraph (1A) or paragraph (1B), it must determine the transitional minimum requirement that applies during that period.

(1D)

The Bank may amend or revoke any determination under paragraph (1C) at any time.”.

(b)

in paragraph (6)—

(i)

in sub-paragraph (b)^f3, after “appropriate cases” insert “, taking into account whether recapitalisation payments under section 214E of FSMA (recapitalisation payments)^f4 may be available”;

(ii)

in sub-paragraph (f)^f5, for “any Commission Regulation containing regulatory technical standards adopted by the European Commission under Article 45.2 of the recovery and resolution directive, so far as they are assimilated law” substitute “the Bank of England’s Statement of Policy on its approach to setting a minimum requirement for own funds and eligible liabilities issued pursuant to section 3B(9) of the Banking Act 2009^f6, as that Statement of Policy may be amended from time to time”.

(c)

omit paragraph (8).

(4)

In article 125 (application and interpretation of Chapter 2), in paragraph (2)—

(a)

in the definition of “minimum consolidated requirement”, after “institutions” insert “, including any transitional minimum consolidated requirement of the group institutions in accordance with article 126(2C)^f7”;

(b)

in the definition of “minimum requirement”, after “liabilities” insert “, including any transitional minimum requirement in accordance with article 135(2C)^f8”.

(5)

In article 126 (determination of minimum consolidated requirement)—

(a)

after paragraph (2) insert—

“(2A)

The Bank may determine a transitional period for a resolution group, during which time a transitional minimum consolidated requirement applies.

(2B)

The Bank may amend or revoke a determination under paragraph (2A), or determine a further transitional period in relation to a resolution group, at any time including where a previous transitional period has expired.

(2C)

Where the Bank determines a transitional period under paragraph (2A) or paragraph (2B), it must determine the transitional minimum consolidated requirement that applies during that period.

(2D)

The Bank may amend or revoke any determination under paragraph (2C) at any time.”.

(b)

in paragraph (8)(a)—

(i)

in paragraph (ii), after “appropriate cases” insert “, taking into account whether recapitalisation payments under section 214E of FSMA may be available”; and

(ii)

in paragraph (vi), for “any Commission Regulation containing regulatory technical standards adopted by the European Commission under Article 45.2 of the recovery and resolution directive, so far as they are assimilated law” substitute “the Bank of England’s Statement of Policy on its approach to setting a minimum requirement for own funds and eligible liabilities issued under section 3B(9) of the Banking Act 2009, as that Statement of Policy may be amended from time to time”.

(6)

In article 135 (determination of minimum requirement for group institutions), after paragraph (2) insert—

“(2A)

The Bank may determine a transitional period for an institution, during which time a transitional minimum requirement applies.

(2B)

The Bank may amend or revoke a determination under paragraph (2A), or determine a further transitional period in relation to an institution, at any time including where a previous transitional period has expired.

(2C)

Where the Bank determines a transitional period under paragraph (2A) or paragraph (2B), it must determine the transitional minimum requirement that applies during that period.

(2D)

The Bank may amend or revoke any determination under paragraph (2C) at any time.”.

Annotations

Footnotes

f1: S.I. 2014/3348. Article 121 was amended by S.I. 2018/1394 and 2021/1376. Articles 123 and 126 were amended by S.I. 2016/1239, 2018/1394, 2020/1350 and 2025/82. Article 125 was amended by S.I. 2018/1394 and S.I. 2020/1350. Article 135 was amended by S.I. 2016/1239 and 2018/1394.
f2: Article 123(1C) is inserted by regulation 2(3)(a).
f3: Sub-paragraph (b) was substituted by S.I. 2020/1350.
f4: Section 214E will be inserted by section 1 of the Bank Resolution (Recapitalisation) Act 2025 (c. 15).
f5: Sub-paragraph (f) was inserted by S.I. 2018/1394 and amended by S.I. 2025/82.
f6: Section 3B was inserted by S.I. 2014/3329.
f7: Article 126(2C) is inserted by regulation 2(5)(a).
f8: Article 135(2C) is inserted by regulation 2(6).