UK Regulators Finalize Approach To Ring-Fencing Transfer Schemes

On March 4, 2016, the Prudential Regulation Authority published its Policy Statement on feedback to its consultation on the PRA's approach to ring-fencing transfer schemes together with the PRA's final Statement of Policy. The Financial Services (Banking Reform) Act 2013 introduced requirements for UK banking groups that have more than £25 billion of core deposits to ring-fence the entity/ies that accept deposits—called ring-fenced bodies. To assist firms subject to the ring-fencing requirements and restructure their business, provisions were made for transfer of businesses by a RFTS.

The PRA's Policy Statement sets out the regulator's responses to questions raised during the consultation, including on the certificate as to financial resources of the transferee, new bank authorizations, alternative group arrangements and immunity of the skilled person. The PRA's Statement of Policy sets out its approach to RFTS, noting that the PRA expects firms to nominate a skilled