Section 123(6)

The determination must be based on an assessment of the following criteria— the need to ensure that the relevant institution can be resolved by the application of the resolution tools including, where appropriate, by making special bail-in provision within the meaning of section 48B of the Banking Act 2009, in a way that meets the special resolution objectives; the need to ensure, in appropriate cases , taking into account whether recapitalisation payments under section 214E of FSMA (recapitalisation payments) may be available, that the relevant institution has sufficient eligible liabilities to ensure that, if mandatory reduction provision within the meaning of section 6B of the Banking Act 2009 or special bail-in provision were made— to a level necessary to enable it to continue to comply with the conditions for authorisation under Part 4A of FSMA and to continue to carry out the activities for which it is authorised; losses could be absorbed; and the capital ratio and, as applicable, the leverage ratio, of the relevant institution could be restored, the need to ensure that, if the resolution plan anticipates that certain classes of eligible liabilities might be excluded from bail-in under section 48B(10) of the Banking Act 2009 or that certain classes of eligible liabilities might be transferred to a recipient in full under a partial transfer— to the level necessary to enable it to continue to comply with the conditions for authorisation under Part 4A of FSMA and to continue to carry out the activities for which it is authorised; the relevant institution has sufficient other eligible liabilities or own funds to ensure that losses could be absorbed; and the capital ratio and, as applicable, the leverage ratio, of the relevant institution could be restored, the size, the business model, the funding model and the risk profile of the relevant institution; ... the extent to which the failure of the relevant institution would have adverse effects on financial stability, including, due to its interconnectedness with other institutions or entities or with the rest of the financial system, through contagion to other institutions or entities; and relevant assessment criteria specified in 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, as that Statement of Policy may be amended from time to time.

← 5 · All articles · 7 →

Source: legislation.gov.uk · retrieved 2026-09-04