Financial institution exposures: conduit lendingU.K.
17.—(1) A ring-fenced body may incur a financial institution exposure to a relevant financial institution (“A”) where—
(a)the only business of A (apart from incidental activities) is to acquire, hold and manage assets from or for an undertaking which is not a relevant financial institution (“B”); and
(b)all or part of A's assets are being used to form the whole or part of the security for a loan or any other finance provided to A by the ring-fenced body or by a conduit vehicle of the ring-fenced body for the benefit of B.
(2) A ring-fenced body (“C”) may incur a financial institution exposure to a relevant financial institution (“D”) where—
(a)D was established by, or is operated for the benefit of, C; and
(b)the only business of D (apart from incidental activities) is—
(i)to acquire, hold and manage assets from or for C, or
(ii)to make loans or provide other finance at the direction or on the advice of C using resources provided by C or raised in the financial markets to entities which are not relevant financial institutions, or to relevant financial institutions which satisfy the conditions in paragraph (1)(a) and (b).
Commencement Information
I1Art. 17 in force at 1.1.2019, see art. 1(3)