Financial Services (Banking Reform) Act 2013—background and context
Financial Services (Banking Reform) Act 2013—background and context

The following Financial Services guidance note provides comprehensive and up to date legal information covering:

  • Financial Services (Banking Reform) Act 2013—background and context
  • Financial Services (Banking Reform) Act 2013
  • The Banking Reform Act in context
  • Key elements of the proposed banking reforms

Financial Services (Banking Reform) Act 2013

The Financial Services (Banking Reform) Act 2013 (FS(BR)A 2013) received Royal Assent on 18 December 2013.

For further reading on banking reform, see:

  1. Practice Notes: Financial Services (Banking Reform) Act 2013—essentials (for an overview and implementation dates of certain provisions of FS(BR)A 2013), and UK structural banking reform

  2. news analysis: What changes should the Financial Services sector expect from the Financial Services (Banking Reform) Act 2013?

This Practice Note outlines the background and context of FS(BR)A 2013. FS(BR)A 2013 made amendments to the Financial Services and Markets Act 2000, Banking Act 2009, Insolvency Act 1986 and Building Societies Act 1986. These put in place fire breaks, known as ‘ring-fences’, between core services (retail banking) and non-core services (wholesale, investment banking). This Practice Note introduces ring-fencing, total loss absorbing capacity (TLAC), the minimum requirement for own funds and eligible liabilities (MREL) depositor preferences and amendments to insolvency legislation, as well as a number of other ancillary amendments to the UK financial services regime.

Background to the Financial Services (Banking Reform) Act 2013

FS(BR)A 2013 came about as a result of the implementation of the Financial Services (Banking Reform) Bill (the Bill) The Bill emerged following the report by the Independent Commission on Banking (ICB) (also known as the Vickers Report). The main concept of the Bill was