BoE published actual and indicative minimum requirements for own funds and eligible liabilities (MRELs) for UK banks and buildings societies that have bail-in or partial transfer resolution strategies. This publication contains actual requirements for 2019 and indicative requirements for 2020-21 and 2022 for UK firms. For resolution plans to be feasible and credible, UK firms are required to maintain sufficient resources that can absorb losses and provide for recapitalization in resolution. To achieve this, BoE requires all banks, building societies, and certain investment firms to maintain a certain MREL.
BoE has calculated the figures by applying its policy on setting MREL to firms’ balance sheet data, as at December 31, 2018. BoE has published MRELs on an individual basis for global and domestic systemically important banks and building societies that are headquartered in UK. BoE has published average MRELs for other UK-headquartered firms that are required to maintain MREL above their capital requirements. From next year onward, BoE intends to publish individual MRELs, rather than an average, for all firms with an indicative MREL above capital requirements.
BoE is committed to, before the end of 2020, review the calibration of MREL and the final compliance date of MREL, prior to setting the end-state MRELs. In doing so, BoE will have regard to any intervening changes in the UK regulatory framework, due to the revision of the Bank Recovery and Resolution Directive and the Capital Requirements Regulation as well as firms’ experience in issuing liabilities to meet their interim MRELs.
- Actual and Indicative MREL (PDF)
- Overview of Actual and Indicative MRELs
- Policy Statement on Setting MREL
Keywords: Europe, UK, Banking, MREL, Actual Requirements, Indicative Requirements, Bail-in, Resolution Plans, Capital Requirements, BRRD, CRR, BoE
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