Financial Stability Paper No. 5
By Peter Brierley
This paper seeks to place in an international context the UK Special Resolution Regime (SRR) for failing banks,(1) which came into effect in February 2009 with the adoption of the Banking Act. The SRR’s key purpose is to enable an orderly resolution of a failing UK bank to be carried out in a manner preserving the public interest, particularly by maintaining financial stability, preserving confidence in the banking sector, and protecting both depositors and the taxpayer. The Northern Rock crisis in 2007 demonstrated clearly that the UK authorities lacked the powers necessary to achieve such a purpose at that time.