Minutes of the Meeting of the Court of Directors held on 20 September 2021

The Bank's Court of Directors acts as a unitary board, setting the organisation's strategy and budget and taking key decisions on resourcing and appointments. Required to meet a minimum seven times per year, it has five executive members from the Bank and up to nine non-executive members.
Published on 05 November 2021

Present:

Mr Fried, Chair

The Governor

Mr Broadbent, Deputy Governor – Monetary Policy

Sir Jon Cunliffe, Deputy Governor – Financial Stability

Sir Dave Ramsden, Deputy Governor – Markets & Banking

Mr Woods, Deputy Governor – Prudential Regulation

Ms Glover

Baroness Harding

Mr Kalifa

Ms Noble

Ms O’Grady

Ms Thompson

In attendance:

Ms Place, Chief Operating Officer

Secretary:

Mr Footman

1. Minutes and Matters Arising

The minutes of the meeting held on 15 July 2021 were approved.

There were no conflicts declared in relation to the present agenda.

Further to a resolution of Court of 11 August, it was noted that Huw Pill had taken up his role as Executive Director and Chief Economist.

Court was updated on the searches for a new Chief Operating Officer and a new CIO.

On a proposal from Sam Woods, Court approved the appointment of Nathanael Benjamin as Executive Director in the PRA for Authorisations, RegTech and International Supervision; and of Duncan MacKinnon as Executive Director, Supervisory Risk Specialists.

Jo Place said that the HR element of the One Bank Service Transformation programme was on track to go live on 4 November. The Chair noted that the Treasury was shortly to start the process to appoint new non-executive directors, and a new Chair as his term expires in June 2022. Two further vacancies would arise in mid-2022.

2. RemCo update

Dido Harding updated Court on Remco’s most recent meeting. One settlement agreement had been approved under the Bank’s governance procedures; and the Committee had approved the pay arrangements for Huw Pill.

3. Regional Footprint – location of Northern office

(Tani Hussain, Andrew Hebden and Simon Heywood)

Further to a discussion on 15 July, Jo Place set out the analysis so far conducted on Leeds as a location for the Bank’s Northern hub.

4. Update on Central Bank Digital Currency (CBDC) – implications for the Bank

(Tom Mutton, Nicholas Butt and Louise Johnston)

Further to discussion papers issued by the Bank in March 2020 and June 2021, Court discussed the possible implications for the Bank of issuing money to the public in digital form. At present the public could hold central bank money only through paper banknotes, the use of which had been declining, particularly during the pandemic. A joint HMT/BoE Task Force to examine the issues raised had been established by the Chancellor in April. Tom Mutton, Director of the Bank’s CBDC Office, described the “use case” and discussed the implications for the Bank and the wider banking system of giving the public access to CBDC.

The Chair asked for clarity about the possible uses of a CBDC. Tom Mutton said that from the point of view of the public it would provide access to the safest form of money in digital as well as paper form, and possibly provide an anchoring role in the payment system. Depending on the functionality provided, it might promote further innovation. Other members suggested that it might provide benefits for the “unbanked” who currently relied on physical cash to make payments. But at the same time it might substitute for bank deposits, currently the predominant form of money, with implications for the traditional fractional reserve banking system.

It was accepted that there were issues to be explored at the technical level, as well as uncertainties about the impact of a CBDC.

5. Risk Update

(Stephen Brown, Jon Rand and Rebecca Estra-Pintel)

Court noted an update, which had previously been discussed in the Executive Risk Committee. Stephen Brown discussed risks around the current hybrid (home/office) working model, and the steps the Bank had taken to mitigate them.

6. Funding discussions with HMT and related consultation

(Afua Kyei, Nat Benjamin, Paul McArdle, Randip Bains and Stephen Fishbourne)

Court noted discussions on the Cash Ratio Deposit (CRD). A draft consultation document had been prepared (with the Treasury); it was likely to be published shortly.

7. House of Lords Economic Affairs Committee (EAC) Report and Bank response

Andrew Bailey noted the recent Report from the EAC, and the Bank’s response.

8. Committee Appointments and Conflicts

(John Footman)

The Secretary updated Court on current work to fill current and forthcoming vacancies on the PRC and the Court.

9. Directorships

Court noted the statement of external directorships and other appointments held by members. The Chair reminded members that he should be consulted before any new appointments were accepted and the Secretary held a full list.

10. New Director appointments for approval

(John Footman)

Court APPROVED the appointment of Huw Pill as a Director of BEAPFF and Sarah John as a Director of BEAPFF and BEALF, in addition to her appointment as Chair of CCFF approved in July.

11. Papers for Information

Court noted:

  • RTGS/CHAPs Report
  • OBST update

The meeting of Court was closed

These minutes are published as the record of meeting as required by the Bank of England Act 1998 as amended. Court may decide to omit information from the record in the public interest. The record of matters reported to Court may also omit information which is legally sensitive or commercially confidential.

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