Banking Act 2009

Banking Act 2009

2009 CHAPTER 1

Commentary on Sections

Part 1: Special Resolution Regime.

Compensation

Section 58: Resolution fund

153. A resolution fund order may provide for persons to share in the proceeds of the disposal of things transferred (for example, the full or partial sale of a bridge bank whether through business or share transfer). Subsection (1) further provides for the order to provide for how proceeds and shares are to be calculated.

154. Subsection (2) allows for any payments to be net of resolution costs, which include public financial assistance or administrative expenses.

155. Subsection (3) provides that a third party compensation order may include provisions for arranging to appoint an independent valuer and to apply the valuation principles. Subsection (4) provides that a resolution fund order can confer discretion on persons and subsection (5) provides that it may include provision for the determination of disputes about the application of its provisions.

156. Subsection (6) allows the Treasury to place a management duty on the Bank of England in managing the bridge bank and set out how the Bank is to meet this duty. Subsection (7) enables a similar duty to be imposed on the Treasury, in cases where the Treasury elects to make a resolution fund order following a transfer of a bank to temporary public ownership.

157. Subsection (8) provides that the duties are only to be complied with to the extent that this is compatible with the pursuit of the special resolution objectives and compliance with the code of practice.