Section 158(2)

Where the parties to the contract have rights to set off or net under a title transfer collateral arrangement, set-off arrangement or netting arrangement (within the meaning given by section 48(1)(b), (c) and (d)), the Bank must ensure that the value of the contract and of the liabilities arising from it are determined— on a net basis in accordance with the terms of the contract; and in accordance with— appropriate methodologies for determining the value of classes of derivative contracts, including transactions that are subject to netting arrangements; principles for establishing the time at which the value of a derivative position should be established; and appropriate methodologies for comparing with each other the following amounts— the loss in value that would result from closing out a derivative contract and making special bail-in provision (within the meaning given by section 48B) in respect of that contract; and the reduction in the liabilities of the institution which is subject to the special bail-in provision as a result of making that provision in respect of the derivative contract.

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