Paragraph 90 Treatment of derivative contracts where bail-in option is appliedI1

Article 158 (liabilities arising from derivative contracts) is amended as follows.

At the end insert—

“(3)

Subject to paragraph (4), the Bank may make technical standards specifying—

(a)

appropriate methodologies for the purposes of paragraph (2)(b)(i);

(b)

principles for the purposes of paragraph (2)(b)(ii); or

(c)

appropriate methodologies for the purposes of paragraph (2)(b)(iii).

(4)

When exercising its functions under paragraph (3) in relation to derivative contracts that are subject to a netting arrangement, the Bank must take into account the methodology for close-out set out in the netting arrangement.”.