Financial Services (Banking Reform) Act 2013—essentials
Financial Services (Banking Reform) Act 2013—essentials

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

  • Financial Services (Banking Reform) Act 2013—essentials
  • UK structural banking reform—Financial Services (Banking Reform) Act 2013
  • Ring-fencing under the Banking Reform Act
  • Latest ring-fencing developments
  • Loss-absorbing under the Banking Reform Act
  • Priority of deposits insured by Financial Services Compensation Scheme (FSCS) under the Banking Reform Act
  • Bail-in under the Banking Reform Act
  • Senior managers and certification regime under the Banking Reform Act
  • Limitation period against a firm or individual under the Banking Reform Act
  • New regime for the regulation of payment services under the Banking Reform Act
  • more

This Practice Note outlines the key changes to UK banking reform adopted following the Financial Services (Banking Reform) Act 2013 (FS(BR)A 2013) (Banking Reform Act). The Banking Reform Act made significant reforms to UK financial services regulation. The Banking Reform Act provided the powers needed by HM Treasury and the Prudential Regulation Authority (PRA) to implement the recommendations of the Sir John Vickers and the Independent Commission on Banking (ICB) on ring-fencing requirements for the banking sector.

The Banking Reform Act also introduced a criminal offence of reckless misconduct in the management of a bank, a payment systems regulator (PSR), the senior managers and certification regime(SM&CR), a bail-in stabilisation option that formed part of the special resolution regime (SRR) and a cap on the cost of payday loans.

UK structural banking reform—Financial Services (Banking Reform) Act 2013

On 18 December 2013, the Banking Reform Act received Royal Assent. There are eight Parts and ten Schedules to the Banking Reform Act. In particular, the Banking Reform Act gave HM Treasury and the relevant regulators, primarily the PRA, powers to implement some of the recommendations of the ICB and in particular the ICB's recommendations for ring-fencing requirements for banks. The Banking Reform Act also took into account some of the recommendations made by the Parliamentary Commission on Banking Standards (PCBS) established in July