In response to a consultation by HM Treasury, the UK’s Financial Markets Law Committee (FMLC) published a letter on June 4 relating to the bail-in powers introduced by the Financial Services (Banking Reform) Act 2013. This act expands the powers available to the Bank of England and HM Treasury to make “bail-in” resolutions in relation to certain classes of investor in failing banks and investment firms by writing down their claims or converting them to equity.
Commenting specifically on the Banking Act 2009 (Restriction of Special Bail-in Provision, etc.) Order 2014 and the Banking Act 2009 (Mandatory Compensation Arrangements Following Bail-in) Regulations, the FMLC remarks and advises on technicalities which should be reflected in draft implementing secondary legislation. FMLC Letter.