Banking Act 2009

Part 8 U.K. General

257 “Financial assistance” U.K.

(1) In this Act “financial assistance” includes giving guarantees or indemnities and any other kind of financial assistance (actual or contingent).

(2) The Treasury may by order provide that a specified activity or transaction, or class of activity or transaction, is to be or not to be treated as financial assistance for a specified purpose of this Act; and subsection (1) is subject to this subsection.

(3) An order—

(a) shall be made by statutory instrument, and

(b) shall be subject to annulment in pursuance of a resolution of either House of Parliament.

Commencement Information

I1 S. 257 in force at 17.2.2009 for specified purposes by S.I. 2009/296, arts. 2, 3, Sch. para. 12

I2 S. 257 in force at 21.2.2009 in so far as not already in force by S.I. 2009/296, arts. 2, 3, Sch. para. 12

258 “Enactment” U.K.

In this Act “enactment” includes—

(a) subordinate legislation,

(b) an Act of the Scottish Parliament and an instrument under an Act of the Scottish Parliament, and

(c) Northern Ireland legislation.

Commencement Information

I3 S. 258 in force at 21.2.2009 by S.I. 2009/296, art. 3, Sch. para. 13

[F1 258A Investment firm” U.K.

(1) In this Act “investment firm” means a UK institution which is (or, but for the exercise of a stabilisation power, would be) an investment firm for the purposes of [F2 Regulation (EU) No. 575/2013 of the European Parliament and of the Council.]

(2) But “investment firm” does not include—

(a) an institution which is also—

(i) a bank (within the meaning of Part 1),

(ii) a building society (within the meaning of section 119 of the Building Societies Act 1986), or

(iii) a credit union (within the meaning of section 31 of the Credit Unions Act 1979 or Article 2(2) of the Credit Unions (Northern Ireland) Order 1985), or

(b) an institution which is of a class or description specified in an order made by the Treasury.

(3) An order—

(a) is to be made by statutory instrument, and

(b) may not be made unless a draft has been laid before and approved by resolution of each House of Parliament.

(4) If an order contains a statement that the Treasury are of the opinion that, by reason of urgency, it is necessary to make the order without complying with subsection (3)(b)—

(a) the order may be made, and

(b) the order lapses unless approved by resolution of each House of Parliament during the period of 28 days (ignoring periods of dissolution, prorogation or adjournment of either House for more than 4 days) beginning with the day on which the order is made.

(5) The lapse of an order under subsection (4)(b)—

(a) does not invalidate anything done under or in reliance on the order before the lapse and at a time when neither House has declined to approve the order, and

(b) does not prevent the making of a new order (in new terms).

(6) In subsection (1) “UK institution” means an institution which is incorporated in, or formed under the law of any part of, the United Kingdom.]

Textual Amendments

F1 S. 258A inserted (5.6.2014 for specified purposes, 1.8.2014 in so far as not already in force) by Financial Services Act 2012 (c. 21), ss. 101(7), 122(3) (with Sch. 20); S.I. 2014/1447, art. 2(f); S.I. 2014/1847, art. 2

F2 Words in s. 258A(1) substituted (1.1.2014) by The Capital Requirements Regulations 2013 (S.I. 2013/3115), reg. 1(2), Sch. 2 para. 45(3)

259 Statutory instruments U.K.

(1) A statutory instrument under this Act—

(a) may make provision that applies generally or only for specified purposes, cases or circumstances,

(b) may make different provision for different purposes, cases or circumstances, and

(c) may include incidental, consequential or transitional provision.

(2) No statutory instrument under this Act shall be treated as a hybrid instrument under Standing Orders of either House of Parliament.

(3) The Table lists the powers to make statutory instruments under this Act and the arrangements for Parliamentary scrutiny in each case (which are subject to subsections (4) to (6)).

Section	Topic	Parliamentary scrutiny
PART 1–Special resolution regime
2	Meaning of “bank”	Draft affirmative resolution
25	Share transfer orders	Negative resolution
47	Partial transfers	Draft affirmative resolution
48	Protection of interests	Draft affirmative resolution
[F3 48F(1) and (2)]	[F3 Power to amend definition of “excluded liabilities”]	[F3 Draft affirmative resolution]
[F3 48G]	[F3 Insolvency treatment principles]	[F3 Draft affirmative resolution]
[F3 48P]	[F3 Safeguarding of certain financial arrangements]	[F3 Draft affirmative resolution]
[F3 52A]	[F3 Bail-in compensation orders]	[F3 Draft affirmative resolution]
55	Independent valuer	Negative resolution
56	Independent valuer: money	Negative resolution
60	[F4 Third party compensation: partial property transfers]	Draft affirmative resolution
[F3 60A]	[F3 Third party compensation: instruments containing special bail-in provision]	[F3 Draft affirmative resolution]
62	Compensation orders	Draft affirmative resolution
69	Continuity obligations: consideration and terms	Negative resolution
F5 . . .	F5 . . .	F5 . . .
74	Tax	Draft affirmative resolution (Commons only)
75	Power to change law	Draft affirmative resolution (except for urgent cases)
78	Public funds	Negative resolution (Commons only)
[F6 81D]	[F6 Meaning of “banking group company”]	[F6 Draft affirmative resolution (except for urgent cases)]
[F7 83ZY]	[F7 Enforcement of share transfer orders]	[F7 Negative resolution]
85	Building societies: orders	Negative resolution
86	Building societies: assets	(As for orders under section 90B of the Building Societies Act 1986)
88	Building societies: consequential	Draft affirmative resolution
89	Credit unions	Draft affirmative resolution
[F8 89F]	[F8 [F9 Recognised central counterparty] compensation orders]	[F8 Draft affirmative resolution]
PART 2–Bank insolvency
91	Meaning of “bank”	Draft affirmative resolution
122	Application of insolvency law	Draft affirmative resolution
125	Rules	(Expansion of power in section 411 of the Insolvency Act 1986)
130	Building societies	Draft affirmative resolution
131	Credit unions	Draft affirmative resolution
132	Partnerships	(As for orders under section 420 of the Insolvency Act 1986)
133	Scottish partnerships	Negative resolution
135	Consequential provision	Draft affirmative resolution
PART 3–Bank administration
148	Sharing information	Negative resolution
149	Multiple original transfers	Draft affirmative resolution
152	Transfer from temporary public ownership	Draft affirmative resolution
[F10 152A]	[F10 Property transfer from transferred institution]	[F10 Draft affirmative resolution]
156	Application of other law	Draft affirmative resolution
158	Building societies	Draft affirmative resolution
159	Credit unions	Draft affirmative resolution
160	Rules	(Expansion of power in section 411 of the Insolvency Act 1986)
163	Partnerships	(As for orders under section 420 of the Insolvency Act 1986)
164	Scottish partnerships	Negative resolution
168	Consequential provision	Draft affirmative resolution
PART 4–Financial Services Compensation Scheme
170	Contingency funding	Draft affirmative resolution
F11 . . .	F11 . . .	F11 . . .
173	Borrowing from National Loans Fund	Negative resolution
PART 5–F12 ... payment systems
191	Bank of England directions: immunity	Negative resolution
203	Fees regulations	Negative resolution
204	Information	Negative resolution
[F13 206A	Services forming part of recognised F14 ... payment systems	Draft affirmative resolution]
PART 6–Banknotes: Scotland and Northern Ireland
[F15 214A	Issuers of banknotes: Scotland and Northern Ireland	Draft affirmative resolution]
215	Banknote regulations	Draft affirmative resolution
PART 7–Miscellaneous
230	Financial institution	Negative resolution
[F16 232(6)]	Investment banks: definition	Draft affirmative resolution
[F17 232(7)	Investment banks: definition of investment activity	Negative resolution]
233	Investment banks: insolvency	Draft affirmative resolution
249	[F18 PRA or FCA—] functions	Draft affirmative resolution
251	Central banks: assistance to building societies	Draft affirmative resolution
255	Financial collateral arrangements	Affirmative resolution
PART 8–General
257	Financial assistance	Negative resolution
[F19 258A]	[F19 Meaning of “investment firm”]	[F19 Draft affirmative resolution (except for urgent cases)]
262	Repeal of Banking (Special Provisions) Act 2008	None
263	Commencement	None

(4) A power listed in subsection (5) may be exercised without a draft being laid before and approved by resolution of each House of Parliament if—

(a) the power is being exercised for the first time, and

(b) the person exercising it is satisfied that it is necessary to exercise it without laying a draft for approval.

(5) The powers are those in—

(a) section 2 (special resolution regime: meaning of “bank”),

(b) section 47 (special resolution regime: partial transfers),

(c) section 48 (special resolution regime: protection of interests),

(d) section 60 (special resolution regime: third party compensation),

[F20 (da) section 60A (special resolution regime: instruments containing special bail-in provision),]

(e) section 88 (special resolution regime: building societies: consequential),

(f) section 91 (bank insolvency: meaning of “bank”),

(g) section 122 (bank insolvency: application of insolvency law),

(h) section 130 (bank insolvency: building societies),

(i) section 135 (bank insolvency: consequential provision),

(j) section 149 (bank administration: multiple original transfers),

(k) section 152 (bank administration: transfer from temporary public ownership),

[F21 (ka) section 152A (bank administration: property transfer from transferred institution),]

(l) section 156 (bank administration: application of other law),

(m) section 158 (bank administration: building societies),

(n) section 168 (bank administration: consequential provision), F22 ...

F22 (o) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(6) Where an instrument is made in reliance on subsection (5)—

(a) it shall lapse unless approved by resolution of each House of Parliament during the period of 28 days (ignoring periods of dissolution, prorogation or adjournment of either House for more than 4 days) beginning with the day on which the instrument is made,

(b) the lapse of an instrument under paragraph (a) does not invalidate anything done under or in reliance on it before its lapse and at a time when neither House has declined to approve it, and

(c) the lapse of an instrument under paragraph (a) does not prevent the making of a new one (in new terms).

Textual Amendments

F3 Words in s. 259(3) Table inserted (31.12.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), s. 148(5), Sch. 2 para. 31(b); S.I. 2014/3160, art. 2(1)(b)

F4 Words in s. 259(3) Table substituted (31.12.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), s. 148(5), Sch. 2 para. 31(a); S.I. 2014/3160, art. 2(1)(b)

F5 Words in s. 259(3) Table omitted (1.1.2015) by virtue of The Bank Recovery and Resolution Order 2014 (S.I. 2014/3329), arts. 1(2), 110(2)

F6 Words in s. 259(3) Table inserted (5.6.2014 for specified purposes, 1.8.2014 in so far as not already in force) by Financial Services Act 2012 (c. 21), ss. 100(6), 122(3) (with Sch. 20); S.I. 2014/1447, art. 2(c); S.I. 2014/1847, art. 2

F7 Words in s. 259(3) Table inserted (1.1.2015) by The Bank Recovery and Resolution Order 2014 (S.I. 2014/3329), arts. 1(2), 110(3)

F8 Words in s. 259(3) Table inserted (1.8.2014) by Financial Services Act 2012 (c. 21), ss. 102(7), 122(3) (with Sch. 20); S.I. 2014/1847, art. 2

F9 Words in s. 259(3) Table substituted (1.4.2013) by The Financial Services and Markets Act 2000 (Over the Counter Derivatives, Central Counterparties and Trade Repositories) Regulations 2013 (S.I. 2013/504), regs. 1(2), 25(3) (with regs. 52-58)

F10 Words in s. 259(3) Table inserted (31.12.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), s. 148(5), Sch. 2 para. 31(c); S.I. 2014/3160, art. 2(1)(b)

F11 Words in s. 259(3) Table omitted (8.4.2010) by virtue of Financial Services Act 2010 (c. 28), s. 26(1)(l), Sch. 2 para. 48(2)

F12 Word in s. 259(3) Table omitted (27.6.2017) by virtue of Digital Economy Act 2017 (c. 30), s. 118(2), Sch. 9 para. 29(a)

F13 Words in s. 259(3) Table inserted (8.4.2010) by Financial Services Act 2010 (c. 28), s. 26(1)(l), Sch. 2 para. 48(3)

F14 Word in s. 259(3) Table omitted (27.6.2017) by virtue of Digital Economy Act 2017 (c. 30), s. 118(2), Sch. 9 para. 29(b)

F15 Words in s. 259(3) inserted Table (6.7.2016) by Bank of England and Financial Services Act 2016 (c. 14), ss. 38(6), 41(3); S.I. 2016/627, reg. 2(1)(bb)

F16 Word in s. 259(3) Table substituted (1.4.2013) by Financial Services Act 2012 (c. 21), s. 122(3), Sch. 17 para. 61(2) (with Sch. 20); S.I. 2013/423, art. 3, Sch.

F17 Words in s. 259(3) Table inserted (1.4.2013) by Financial Services Act 2012 (c. 21), s. 122(3), Sch. 17 para. 61(3) (with Sch. 20); S.I. 2013/423, art. 3, Sch.

F18 Words in s. 259(3) Table substituted (1.4.2013) by Financial Services Act 2012 (c. 21), s. 122(3), Sch. 17 para. 61(4) (with Sch. 20); S.I. 2013/423, art. 3, Sch.

F19 Words in s. 259(3) Table inserted (5.6.2014 for specified purposes, 1.8.2014 in so far as not already in force) by Financial Services Act 2012 (c. 21), ss. 101(8), 122(3) (with Sch. 20); S.I. 2014/1447, art. 2(f); S.I. 2014/1847, art. 2

F20 S. 259(5)(da) inserted (31.12.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), s. 148(5), Sch. 2 para. 31(d); S.I. 2014/3160, art. 2(1)(b)

F21 S. 259(5)(ka) inserted (31.12.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), s. 148(5), Sch. 2 para. 31(e); S.I. 2014/3160, art. 2(1)(b)

F22 S. 259(5)(o) and word omitted (8.4.2010) by virtue of Financial Services Act 2010 (c. 28), s. 26(1)(l), Sch. 2 para. 48(4)

Commencement Information

I4 S. 259 in force at 21.2.2009 by S.I. 2009/296, art. 3, Sch. para. 14

260 Money U.K.

Expenditure of the Treasury under, by virtue of or in connection with a provision of this Act shall be paid out of money provided by Parliament.

Commencement Information

I5 S. 260 in force at 21.2.2009 by S.I. 2009/296, art. 3, Sch. para. 15

261 Index of defined terms U.K.

The Table sets out expressions defined in this Act for general purposes.

Expression	Section
Action	93 and 166
[F23 Additional Tier 1 instruments (in Part 1)]	[F23 3]
[F24 Bail-in compensation order]	[F24 49]
Bank (Part 1)	2
Bank (Part 2)	91
Bank administration	136
Bank administration order	141
Bank insolvency	90
Bank insolvency order	94
[F25 Bank of England	256B]
[F26 Banking group company]	[F26 81D]
Bridge bank	12
Bridge bank reverse share transfer instrument	31
Bridge bank share transfer instrument	30
[F27 Bridge bank supplemental property transfer instrument	44D
Bridge bank supplemental reverse property transfer instrument	44E]
[F23 the capital requirements regulation (in Part 1)]	[F23 3]
F28 . . .	F28 . . .
[F29 Client assets (Part 1)]	[F29 3]
[F23 Common Equity Tier 1 instruments (in Part 1)]	[F23 3]
Compensation scheme order	49
The court (Part 2)	92
The court (Part 3)	166
[F23 critical functions (in Part 1)]	[F23 3]
Eligible depositors	93
[F23 eligible liabilities]	[F23 3]
Enactment	258
[F23 extraordinary public financial support (in Part 1)]	[F23 3]
[F30 FCA]	[F30 3, 93, 166 & 183]
F31 . . .	F31 . . .
FSCS	93
Fair	93
Financial assistance	257
Financial institution	230
Full payment resolution	100
Independent valuer	54
F32 . . .	F32 . . .
[F33 Investment firm]	[F33 258A]
Liquidation committee	100
[F23 mandatory reduction instrument]	[F23 6B]
Objective 1 Achievement Notice	139
Onward bridge bank	12
Onward property transfer instrument	43
[F27 Onward share transfer instrument	26ZA]
Onward share transfer order	28
[F23 own funds (in Part 1)]	[F23 3]
[F23 own funds requirements (in Part 1)]	[F23 3]
Partial property transfer	47
[F34 Payment system]	[F34 182]
[F35 Payment Systems Regulator	183]
[F36 PRA-authorised person]	[F36 89G]
[F37 PRA]	[F37 3, 93, 166 & 183]
[F38 Private sector reverse property transfer instrument]	[F38 42A]
Property transfer instrument	33
Property transfer order	45
[F25 Prudential Regulation Authority	256B]
[F39 recognised central counterparty]	[F39 89G]
[F23 the recovery and resolution directive (in Part 1)]	[F23 3]
[F23 relevant capital instruments (in Part 1)]	[F23 3]
[F23 resolution company]	[F23 29A]
Resolution fund order	49
[F24 Resolution instrument]	[F24 12A]
Reverse property transfer instrument	44
Reverse property transfer order	46
F40 [F41 ... reverse share transfer instrument	26A]
Reverse share transfer order	29
Securities	14
Share transfer instrument	15
Share transfer order	16
[F24 Special bail-in provision]	[F24 48B]
Special resolution regime	1
Special resolution objectives	4
Stabilisation options	1
Stabilisation powers	1
Supplemental property transfer instrument	42
Supplemental share transfer instrument or order	26 & 27
[F23 third-country instrument]	[F23 89I]
Third party compensation order	49 & 59
[F23 Tier 2 instruments (in Part 1)]	[F23 3]
Unable to pay debts	93 & 166
F42 . . .	F42 . . .

Textual Amendments

F23 Words in s. 261 inserted (1.1.2015) by The Bank Recovery and Resolution Order 2014 (S.I. 2014/3329), arts. 1(2), 111

F24 Words in s. 261 inserted (31.12.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), s. 148(5), Sch. 2 para. 32; S.I. 2014/3160, art. 2(1)(b)

F25 Words in s. 261 inserted (1.3.2017) by Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 63 (with Sch. 3); S.I. 2017/43, reg. 2(g)

F26 Words in s. 261 inserted (5.6.2014 for specified purposes, 1.8.2014 in so far as not already in force) by Financial Services Act 2012 (c. 21), ss. 100(7), 122(3) (with Sch. 20); S.I. 2014/1447, art. 2(c); S.I. 2014/1847, art. 2

F27 Words in s. 261 inserted (16.12.2016) by The Bank Recovery and Resolution Order 2016 (S.I. 2016/1239), arts. 1(2), 27(a)

F28 Words in s. 261 omitted (1.4.2013) by virtue of The Financial Services and Markets Act 2000 (Over the Counter Derivatives, Central Counterparties and Trade Repositories) Regulations 2013 (S.I. 2013/504), regs. 1(2), 25(6)(a) (with regs. 52-58)

F29 Words in s. 261 inserted (1.1.2015) by Financial Services Act 2012 (c. 21), ss. 96(6), 122(3) (with Sch. 20); S.I. 2014/3323, art. 2

F30 Words in s. 261 inserted (1.4.2013) by Financial Services Act 2012 (c. 21), s. 122(3), Sch. 17 para. 62(a) (with Sch. 20); S.I. 2013/423, art. 3, Sch.

F31 Words in s. 261 omitted (1.4.2013) by virtue of Financial Services Act 2012 (c. 21), s. 122(3), Sch. 17 para. 62(b) (with Sch. 20); S.I. 2013/423, art. 3, Sch.

F32 Words in s. 261 omitted (27.6.2017) by virtue of Digital Economy Act 2017 (c. 30), s. 118(2), Sch. 9 para. 30(a)

F33 Words in s. 261 inserted (5.6.2014 for specified purposes, 1.8.2014 in so far as not already in force) by Financial Services Act 2012 (c. 21), ss. 101(9), 122(3) (with Sch. 20); S.I. 2014/1447, art. 2(f); S.I. 2014/1847, art. 2

F34 Words in s. 261 inserted (27.6.2017) by Digital Economy Act 2017 (c. 30), s. 118(2), Sch. 9 para. 30(b)

F35 Words in s. 261 inserted (30.11.2017) by The Banking Act 2009 (Service Providers to Payment Systems) Order 2017 (S.I. 2017/1167), arts. 1(2), 2(29)

F36 Words in s. 261 inserted (1.8.2014) by Financial Services Act 2012 (c. 21), ss. 102(8)(b), 122(3) (with Sch. 20); S.I. 2014/1847, art. 2

F37 Words in s. 261 inserted (1.4.2013) by Financial Services Act 2012 (c. 21), s. 122(3), Sch. 17 para. 62(c) (with Sch. 20); S.I. 2013/423, art. 3, Sch.

F38 Words in s. 261 inserted (1.4.2013) by Financial Services Act 2012 (c. 21), ss. 97(11), 122(3) (with Sch. 20); S.I. 2013/423, art. 3, Sch.

F39 Words in s. 261 inserted (1.4.2013) by The Financial Services and Markets Act 2000 (Over the Counter Derivatives, Central Counterparties and Trade Repositories) Regulations 2013 (S.I. 2013/504), regs. 1(2), 25(6)(b) (with regs. 52-58)

F40 Words in s. 261 omitted (16.12.2016) by virtue of The Bank Recovery and Resolution Order 2016 (S.I. 2016/1239), arts. 1(2), 27(b)(i)

F41 Words in s. 261 moved (16.12.2016) by The Bank Recovery and Resolution Order 2016 (S.I. 2016/1239), arts. 1(2), 27(b)(ii)

F42 Words in s. 261 omitted (1.4.2013) by virtue of The Financial Services and Markets Act 2000 (Over the Counter Derivatives, Central Counterparties and Trade Repositories) Regulations 2013 (S.I. 2013/504), regs. 1(2), 25(6)(c) (with regs. 52-58)

Commencement Information

I6 S. 261 in force at 21.2.2009 by S.I. 2009/296, art. 3, Sch. para. 16

262 Repeal U.K.

(1) The Treasury may by order repeal the Banking (Special Provisions) Act 2008.

(2) An order—

(a) may include savings, and

(b) shall be made by statutory instrument.

(3) Subsection (2)(a) is without prejudice to the generality of, or the application to this section of, section 259.

Commencement Information

I7 S. 262 in force at 17.2.2009 for specified purposes by S.I. 2009/296, arts. 2, 3, Sch. para. 17

I8 S. 262 in force at 21.2.2009 in so far as not already in force by S.I. 2009/296, arts. 2, 3, Sch. para. 17

263 Commencement U.K.

(1) The preceding provisions of this Act shall come into force in accordance with provision made by the Treasury by order.

(2) Subsection (1) does not apply to section 254, which comes into force at the end of the period of 2 months beginning with the date of Royal Assent.

(3) An order under subsection (1)—

(a) may make provision generally or only in relation to specific provisions or purposes,

(b) may make different provision for different provisions or purposes,

(c) may include incidental or transitional provision (including savings), and

(d) shall be made by statutory instrument.

(4) Where the Treasury or another authority are required to consult or take other action before exercising a power or fulfilling a duty to make legislation or to do any other thing under, by virtue of or in connection with this Act, the Treasury or other authority may rely on consultation or other action carried out before the commencement of the relevant provision of this Act.

264 Extent U.K.

(1) This Act extends to—

(a) England and Wales,

(b) Scotland, and

(c) Northern Ireland.

(2) But—

(a) sections 253 and 254 extend to Scotland only, and

(b) an amendment of an enactment has the same extent as the enactment (or the relevant part).

265 Short title U.K.

This Act may be cited as the Banking Act 2009.