General Information & Client Services
  • Americas: +1.212.553.1653
  • Asia: +852.3551.3077
  • China: +86.10.6319.6580
  • EMEA: +44.20.7772.5454
  • Japan: +81.3.5408.4100
Media Relations
  • New York: +1.212.553.0376
  • London: +44.20.7772.5456
  • Hong Kong: +852.3758.1350
  • Tokyo: +813.5408.4110
  • Sydney: +61.2.9270.8141
  • Mexico City: +001.888.779.5833
  • Buenos Aires: +0800.666.3506
  • São Paulo: +0800.891.2518
June 13, 2018

BoE released its final Statement of Policy on valuation capabilities to support resolvability. The policy statement also discusses responses to the consultation paper, which was published in August 2017. The policy includes principles for the data, information, models, governance, documentation, and assurance firms will need to have in place to support timely and robust resolution valuations. The deadline for compliance with the policy is January 01, 2021.

The broad purpose of these valuations is to inform the application of resolution tools and to ensure that the full extent of losses is appreciated on entry into resolution. Valuations will also be a key input into the Bank’s decisions around resolution more broadly. For instance, in a UK-led bail-in, valuations also inform the BoE decisions on a firm’s reorganization plan and the allocation of equity to bailed-in creditors. Furthermore, valuations help inform decisions about the recapitalization of subsidiaries, including through the write-down or conversion of intragroup claims held for purposes of meeting internal MREL. The Statement of Policy is being provided in accordance with section 3B(9) of the Banking Act 2009. The policy applies to the UK-based institutions whose preferred resolution strategy involves the use of stabilization powers and to the material UK subsidiaries of overseas-based banking groups. 

The BoE power of direction applies to banks, building societies, and certain investment firms (institutions) that are authorized by PRA or FCA; parent companies of such institutions that are financial holding companies or mixed financial holding companies; and PRA or FCA-authorized financial institutions that are subsidiaries of such institutions or such parent companies. However, this Statement of Policy applies to the institutions that meet the criteria set out in paragraphs 2.1 (a) and (b) of the Statement of Policy. These criteria are aligned with those set out by the Bank for setting minimum requirements for own funds and eligible liabilities (MREL) and internal MREL above regulatory capital requirements. 


Related Links

Effective Date: January 01, 2021

Keywords: Europe, UK, Banking, Bail-in, Resolution Planning, Valuation Capabilities, BoE

Related Insights
News

IAIS Publishes Drafts of Revised ICP 8, ICP 15, ICP 16, and ICP 20

IAIS published the drafts of revised Insurance Core Principles on Public Disclosure (ICP 20), Investments (ICP 15), Enterprise Risk Management for Solvency Purposes (ICP 16), and Risk Management and Internal Controls (ICP 8), along with a revised draft of the glossary on enterprise risk management (ERM).

November 14, 2018 WebPage Regulatory News
News

MAS Amends Notice 637 on Capital Adequacy Requirements in Singapore

MAS published the final, revised Notice 637 on the risk-based capital adequacy requirements in Singapore.

November 13, 2018 WebPage Regulatory News
News

ESMA Updates Q&A on Implementation of CSD Regulation and MAR

ESMA updated questions and answers (Q&A) documents on the implementation of the Central Securities Depository (CSD) Regulation and Market Abuse Regulation (MAR).

November 12, 2018 WebPage Regulatory News
News

FSB Finalizes and Publishes the Cyber Lexicon

FSB published a cyber lexicon, following the public consultation earlier this year.

November 12, 2018 WebPage Regulatory News
News

SRB Updates Liability Data Reporting Template for 2019

SRB published version 2.7.1 of the Liability Data Reporting (LDR) Template.

November 12, 2018 WebPage Regulatory News
News

ECB to Conduct Comprehensive Assessment of Six Bulgarian Banks

ECB will undertake a comprehensive assessment of six Bulgarian banks. The exercise, comprising an asset quality review and a stress test, follows Bulgaria’s submission of a request to establish close cooperation with ECB on July 18, 2018.

November 12, 2018 WebPage Regulatory News
News

IMF Publishes Reports on the 2018 Article IV Consultation with Chile

IMF published its staff report and selected issues report under the 2018 Article IV consultation with Chile.

November 09, 2018 WebPage Regulatory News
News

PRA Issues PS27/18 on Implementing the Extension of SM&CR to Insurers

PRA published the policy statement PS27/18, which provides feedback to responses to the consultation paper CP20/18, on implementing the extension of the Senior Managers and Certification Regime (SM&CR) to insurers (Part 2).

November 09, 2018 WebPage Regulatory News
News

EBA Single Rulebook Q&A: First Update for November 2018

EBA published answers to seven questions under the Single Rulebook question and answer (Q&A) updates for this week.

November 09, 2018 WebPage Regulatory News
News

FED Finalizes the Large Financial Institution Rating System

FED finalized the new supervisory rating system for Large Financial Institutions (LFIs), to better align with the current supervisory programs and practices for these firms.

November 09, 2018 WebPage Regulatory News
RESULTS 1 - 10 OF 2204