United Kingdom banking law refers to
banking law
Bank regulation is a form of government regulation which subjects banks to certain requirements, restrictions and guidelines, designed to create market transparency between banking institutions and the individuals and corporations with whom they ...
in the
United Kingdom
The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom (UK) or Britain, is a country in Europe, off the north-western coast of the continental mainland. It comprises England, Scotland, Wales and North ...
, to control the activities of
bank
A bank is a financial institution that accepts deposits from the public and creates a demand deposit while simultaneously making loans. Lending activities can be directly performed by the bank or indirectly through capital markets.
Because ...
s.
History
![London MMB »2C0 Royal Exchange](https://upload.wikimedia.org/wikipedia/commons/b/bf/London_MMB_%C2%BB2C0_Royal_Exchange.jpg)
The
Bank of England
The Bank of England is the central bank of the United Kingdom and the model on which most modern central banks have been based. Established in 1694 to act as the English Government's banker, and still one of the bankers for the Government of ...
was originally established as a corporation with private shareholders under the
Bank of England Act 1694
The Bank of England Act 1694 (5 & 6 Will & Mar c 20), sometimes referred to as the Tonnage Act 1694, is an Act of the Parliament of England. It is one of the Bank of England Acts 1694 to 1892.The Short Titles Act 1896, section 2(1) and Schedule ...
, to raise money for war with
Louis XIV
, house = Bourbon
, father = Louis XIII
, mother = Anne of Austria
, birth_date =
, birth_place = Château de Saint-Germain-en-Laye, Saint-Germain-en-Laye, France
, death_date =
, death_place = Palace of Vers ...
,
King of France
France was ruled by monarchs from the establishment of the Kingdom of West Francia in 843 until the end of the Second French Empire in 1870, with several interruptions.
Classical French historiography usually regards Clovis I () as the first ...
. After the
South Sea Company
The South Sea Company (officially The Governor and Company of the merchants of Great Britain, trading to the South Seas and other parts of America, and for the encouragement of the Fishery) was a British joint-stock company founded in Ja ...
collapsed in a
speculative bubble
An economic bubble (also called a speculative bubble or a financial bubble) is a period when current asset prices greatly exceed their intrinsic valuation, being the valuation that the underlying long-term fundamentals justify. Bubbles can be c ...
in 1720, the
Bank of England
The Bank of England is the central bank of the United Kingdom and the model on which most modern central banks have been based. Established in 1694 to act as the English Government's banker, and still one of the bankers for the Government of ...
became the dominant financial institution, and acted as a banker to the
UK government
ga, Rialtas a Shoilse gd, Riaghaltas a Mhòrachd
, image = HM Government logo.svg
, image_size = 220px
, image2 = Royal Coat of Arms of the United Kingdom (HM Government).svg
, image_size2 = 180px
, caption = Royal Arms
, date_es ...
and other private banks.
The Bank of England could, simply by being the biggest financial institution, influence interest rates that other banks charged to businesses and consumers by altering its interest rate for the banks' bank accounts. The
Bank of England Act 1716
The Bank of England Act 1716 (3 Geo. 1 c. 8) was an Act of the Parliament of Great Britain. It was one of the Bank of England Acts 1694 to 1892.The Short Titles Act 1896, section 2(1) and Schedule 2
It was partially repealed by the Statute Law ...
widened its borrowing power. The
Bank Restriction Act 1797
The Bank Restriction Act 1797 was an Act of the Parliament of Great Britain (37 Geo. III. c. 45) which removed the requirement for the Bank of England to convert banknotes into gold. The period lasted until 1821, when convertibility was restored. ...
removed a requirement to convert notes to gold on demand. The
Bank Charter Act 1844
The Bank Charter Act 1844 (7 & 8 Vict. c. 32), sometimes referred to as the Peel Banking Act of 1844, was an Act of Parliament, Act of the Parliament of the United Kingdom, passed under the government of Robert Peel, which restricted the powers ...
gave the bank sole rights to issue notes and coins. It also acted as a lender through the 19th century in emergencies to finance banks facing collapse. Because of its power, many believed the Bank of England should have more public duties and supervision. The
Bank of England Act 1946
The Bank of England Act 1946c 27 is an Act of Parliament of the United Kingdom which came into force on 14 February 1946. The Act brought all of the stock of the Bank of England into public ownership on the "appointed date" (1 March 1946). This ...
nationalised it. Its current constitution, and guarantees of a degree of operational independence from government, is found in the
Bank of England Act 1998
A bank is a financial institution that accepts deposits from the public and creates a demand deposit while simultaneously making loans. Lending activities can be directly performed by the bank or indirectly through capital markets.
Because ...
.
*
Macmillan Committee The Macmillan Committee, officially known as the Committee on Finance and Industry, was a committee, composed mostly of economists, formed by the British government after the 1929 stock market crash to determine the root causes of the depressed eco ...
(1929)
Central bank
UK banking has two main parts. First, the
Bank of England
The Bank of England is the central bank of the United Kingdom and the model on which most modern central banks have been based. Established in 1694 to act as the English Government's banker, and still one of the bankers for the Government of ...
administers
monetary policy
Monetary policy is the policy adopted by the monetary authority of a nation to control either the interest rate payable for very short-term borrowing (borrowing by banks from each other to meet their short-term needs) or the money supply, often a ...
, influencing
interest rates
An interest rate is the amount of interest due per period, as a proportion of the amount lent, deposited, or borrowed (called the principal sum). The total interest on an amount lent or borrowed depends on the principal sum, the interest rate, th ...
,
inflation
In economics, inflation is an increase in the general price level of goods and services in an economy. When the general price level rises, each unit of currency buys fewer goods and services; consequently, inflation corresponds to a reductio ...
and
employment
Employment is a relationship between two parties regulating the provision of paid labour services. Usually based on a contract, one party, the employer, which might be a corporation, a not-for-profit organization, a co-operative, or any othe ...
, and it regulates the banking market with
HM Treasury
His Majesty's Treasury (HM Treasury), occasionally referred to as the Exchequer, or more informally the Treasury, is a department of His Majesty's Government responsible for developing and executing the government's public finance policy and ec ...
, the
Prudential Regulation Authority and
Financial Conduct Authority
The Financial Conduct Authority (FCA) is a financial regulation, financial regulatory body in the United Kingdom, but operates independently of the UK Government, and is financed by charging fees to members of the financial services industry. The ...
. Second, there are private banks, and some non-shareholder banks (co-operatives, mutual or
building societies
A building society is a financial institution owned by its members as a mutual organization. Building societies offer banking and related financial services, especially savings and mortgage lending. Building societies exist in the United Kingd ...
), that provide
credit
Credit (from Latin verb ''credit'', meaning "one believes") is the trust which allows one party to provide money or resources to another party wherein the second party does not reimburse the first party immediately (thereby generating a debt), ...
to consumer and business clients. Borrowing money on credit (and repaying the
debt
Debt is an obligation that requires one party, the debtor, to pay money or other agreed-upon value to another party, the creditor. Debt is a deferred payment, or series of payments, which differentiates it from an immediate purchase. The ...
later) is important for people expand a business, invest in a new enterprise, or purchase valuable assets more quickly than by saving. Every day, banks estimate the prospects of a borrower succeeding or failing, and set interest rates for debt repayments according to their predictions of the risk (or average risk of ventures like it). If all banks together lend more money, this means enterprises will do more, potentially employ more people, and if business ventures are productive in the long run, society's prosperity will increase. If banks charge interest that people cannot afford, or if banks lend too much money to ventures that are unproductive, economic growth will slow, stagnate, and sometimes crash. Although UK banks, except the
Bank of England
The Bank of England is the central bank of the United Kingdom and the model on which most modern central banks have been based. Established in 1694 to act as the English Government's banker, and still one of the bankers for the Government of ...
, are shareholder or mutually owned, many countries operate public retail banks (for consumers) and public investment banks (for business). The UK used to run
Girobank
National Girobank was a British public sector financial institution run by the General Post Office that opened for business in October 1968. It started life as ''National Giro'' then ''National Girobank'' and finally ''Girobank plc'' be ...
for consumers, and there have been many proposals for a "
British Investment Bank The British Investment Bank was a proposed public bank designed to finance projects of national interest. All members of the G7 group of countries, plus Russia, have a public investment bank of varying kinds, except for Britain. It is seen as a usef ...
" (like the
Nordic Investment Bank
The Nordic Investment Bank (NIB) is an international financial institution founded in 1975 by the five Nordic countries (Denmark, Finland, Iceland, Norway, and Sweden). In 2005, the three Baltic states (Estonia, Latvia, and Lithuania) also becam ...
or
KfW
The KfW, which together with its subsidiaries DEG, KfW IPEX-Bank and FuB forms the KfW Bankengruppe ("banking group"), is a German state-owned investment bank, investment and Development finance institution, development bank, based in Frankfurt ...
in
Germany
Germany,, officially the Federal Republic of Germany, is a country in Central Europe. It is the second most populous country in Europe after Russia, and the most populous member state of the European Union. Germany is situated betwe ...
) since the
financial crisis of 2007–2008
Finance is the study and discipline of money, currency and capital assets. It is related to, but not synonymous with economics, the study of production, distribution, and consumption of money, assets, goods and services (the discipline of fi ...
, but these proposals have not yet been accepted.
Central bank governance
Under the
Bank of England Act 1998
A bank is a financial institution that accepts deposits from the public and creates a demand deposit while simultaneously making loans. Lending activities can be directly performed by the bank or indirectly through capital markets.
Because ...
section 1, the bank's executive body, the "Court of Directors" is "appointed by
Her Majesty", which in effect is the
prime minister
A prime minister, premier or chief of cabinet is the head of the cabinet and the leader of the ministers in the executive branch of government, often in a parliamentary or semi-presidential system. Under those systems, a prime minister is not ...
. This includes the
Governor of the Bank of England
The governor of the Bank of England is the most senior position in the Bank of England. It is nominally a civil service post, but the appointment tends to be from within the bank, with the incumbent grooming their successor. The governor of the Ba ...
(currently
Andrew Bailey) and up to 14 directors in total (currently there are 12, 9 men and 3 women). The Governor may serve for a maximum of 8 years, deputy governors for a maximum of 10 years, but they may be removed only if they acquire a political position, work for the bank, are absent for over 3 months, become bankrupt, or "is unable or unfit to discharge his functions as a member". This makes removal hard, and potentially a court review. A sub-committee of directors sets pay for all directors, rather than a non-conflicted body like
Parliament
In modern politics, and history, a parliament is a legislative body of government. Generally, a modern parliament has three functions: Representation (politics), representing the Election#Suffrage, electorate, making laws, and overseeing ...
.
Interest rates
The
Bank of England
The Bank of England is the central bank of the United Kingdom and the model on which most modern central banks have been based. Established in 1694 to act as the English Government's banker, and still one of the bankers for the Government of ...
provides finance and support to, and may influence interest rates of the private banks through monetary policy. Possibly the Bank's most important function is administering
monetary policy
Monetary policy is the policy adopted by the monetary authority of a nation to control either the interest rate payable for very short-term borrowing (borrowing by banks from each other to meet their short-term needs) or the money supply, often a ...
. This affects growth and employment. Under
BEA 1998
The Monetary Policy Committee (MPC) is a committee of the Bank of England, which meets for three and a half days, eight times a year, to decide the official interest rate in the United Kingdom (the Bank of England Base Rate).
It is also respon ...
section 11 its objectives are to (a) "maintain price stability, and (b) subject to that, to support the economic policy of Her Majesty’s Government, including its objectives for growth and
employment
Employment is a relationship between two parties regulating the provision of paid labour services. Usually based on a contract, one party, the employer, which might be a corporation, a not-for-profit organization, a co-operative, or any othe ...
." Under section 12, the Treasury issues its interpretation of "price stability" and "economic policy" each year, together with an
inflation
In economics, inflation is an increase in the general price level of goods and services in an economy. When the general price level rises, each unit of currency buys fewer goods and services; consequently, inflation corresponds to a reductio ...
target. To change inflation, the
Bank of England
The Bank of England is the central bank of the United Kingdom and the model on which most modern central banks have been based. Established in 1694 to act as the English Government's banker, and still one of the bankers for the Government of ...
has three main policy options. First, it performs "
open market operations
In macroeconomics, an open market operation (OMO) is an activity by a central bank to give (or take) liquidity in its currency to (or from) a bank or a group of banks. The central bank can either buy or sell government bonds (or other financial as ...
", buying and selling banks'
bond
Bond or bonds may refer to:
Common meanings
* Bond (finance), a type of debt security
* Bail bond, a commercial third-party guarantor of surety bonds in the United States
* Chemical bond, the attraction of atoms, ions or molecules to form chemical ...
s at differing rates (i.e. loaning money to banks at higher or lower interest, known "
discounting
Discounting is a financial mechanism in which a debtor obtains the right to delay payments to a creditor, for a defined period of time, in exchange for a charge or fee.See "Time Value", "Discount", "Discount Yield", "Compound Interest", "Efficient ...
"), buying back
government bonds
A government bond or sovereign bond is a form of bond issued by a government to support public spending. It generally includes a commitment to pay periodic interest, called coupon payments'','' and to repay the face value on the maturity date ...
("
repos") or selling them, and giving credit to banks at differing rates. This will affect the interest rate banks charge by influencing the quantity of money in the economy (more spending by the central bank means more money, and so lower interest) but also may not. Second, the
Bank of England
The Bank of England is the central bank of the United Kingdom and the model on which most modern central banks have been based. Established in 1694 to act as the English Government's banker, and still one of the bankers for the Government of ...
may direct banks to keep different higher or lower reserves proportionate to their lending. Third, the Bank of England could direct private banks adopt specific deposit taking or lending policies, in specified volumes or interest rates. The Treasury is, however, only meant to give orders to the Bank of England in "extreme economic circumstances". This should ensure that changes to monetary policy are undertaken neutrally, and artificial booms are not manufactured before an election.
Private bank oversight
*
Bank of England Act 1998
A bank is a financial institution that accepts deposits from the public and creates a demand deposit while simultaneously making loans. Lending activities can be directly performed by the bank or indirectly through capital markets.
Because ...
*''
Three Rivers DC v Bank of England
3 is a number, numeral, and glyph.
3, three, or III may also refer to:
* AD 3, the third year of the AD era
* 3 BC, the third year before the AD era
* March, the third month
Books
* '' Three of Them'' (Russian: ', literally, "three"), a 1901 ...
''
*
Bank of Credit and Commerce International
The Bank of Credit and Commerce International (BCCI) was an international bank founded in 1972 by Agha Hasan Abedi, a Pakistani financier. The bank was registered in Luxembourg with head offices in Karachi and London. A decade after opening, BCC ...
Private bank governance
![Cabot Square, Canary Wharf - June 2008](https://upload.wikimedia.org/wikipedia/commons/f/ff/Cabot_Square%2C_Canary_Wharf_-_June_2008.jpg)
Outside the central bank, banks are mostly run as profit-making corporations, without meaningful representation for customers. This means, the standard rules in the
Companies Act 2006
The Companies Act 2006 (c 46) is an Act of the Parliament of the United Kingdom which forms the primary source of UK company law.
The Act was brought into force in stages, with the final provision being commenced on 1 October 2009. It largely ...
apply.
Directors and shareholders
Directors are usually appointed by existing directors in the
nomination committee
A committee or commission is a body of one or more persons subordinate to a deliberative assembly. A committee is not itself considered to be a form of assembly. Usually, the assembly sends matters into a committee as a way to explore them more ...
, unless the members of a company (invariably shareholders) remove them by majority vote. Bank directors largely set their own pay, delegating the task to a
remuneration
Remuneration is the pay or other financial compensation provided in exchange for an employee's ''services performed'' (not to be confused with giving (away), or donating, or the act of providing to). A number of complementary benefits in additio ...
committee of the board. Most shareholders are
asset managers
Asset management is a systematic approach to the governance and realization of value from the things that a group or entity is responsible for, over their whole life cycles. It may apply both to tangible assets (physical objects such as buildings ...
, exercising votes with other people's money that comes through pensions, life insurance or mutual funds, who are meant to engage with boards, but have few explicit channels to represent the ultimate investors. Asset managers rarely sue for breach of directors' duties (for negligence or conflicts of interest), through derivative claims.
Concerns about "short-termism" have been written about by the
Kay Review
The name Kay is found both as a surname (see Kay (surname)) and as a given name. In English-speaking countries, it is usually a feminine name, often a short form of Katherine or one of its variants; but it is also used as a first name in its own r ...
2014 on short and long term thinking in equity markets, and the
Walker Review
Walker or The Walker may refer to:
People
*Walker (given name)
* Walker (surname)
* Walker (Brazilian footballer) (born 1982), Brazilian footballer
Places
In the United States
* Walker, Arizona, in Yavapai County
* Walker, Mono County, Californ ...
2009 on bank governance. These have not yet examined the responsibility of
institutional investors
An institutional investor is an entity which pools money to purchase securities, real property, and other investment assets or originate loans. Institutional investors include commercial banks, central banks, credit unions, government-linked co ...
, and asset managers who vote with other people's money.
Employee rights
Since the
Credit Institutions Directive 2013
The Credit Institutions Directive''2013/36/EUis an EU law that aims to ensure banks are run prudently, and do not go insolvent. It was introduced as part of a package rules, following the financial crisis of 2007–2008, with the Capital Requireme ...
, there are some added governance requirements beyond the general framework: for example, duties of directors must be clearly defined, and there should be a policy on board diversity to ensure gender and ethnic balance. If the UK had employee representation on boards, there would also be a requirement for at least one employee to sit on the remuneration committee, but this step has not yet been taken. The
Credit Institutions Directive 2013
The Credit Institutions Directive''2013/36/EUis an EU law that aims to ensure banks are run prudently, and do not go insolvent. It was introduced as part of a package rules, following the financial crisis of 2007–2008, with the Capital Requireme ...
2013/36/EUarticle 95 states "If employee representation... is provided for by national law, the remuneration committee shall include one or more employee representatives."
Licensing and passport
There is some public oversight through the bank licensing system. Under the
Financial Services and Markets Act 2000
The Financial Services and Markets Act 2000c 8 is an Act of the Parliament of the United Kingdom that created the Financial Services Authority (FSA) as a regulator for insurance, investment business and banking, and the Financial Ombudsman Serv ...
section 19 there is a "general prohibition" on performing a "regulated activity", including accepting deposits from the public, without authority. The two main UK regulators are the
Prudential Regulation Authority and the
Financial Conduct Authority
The Financial Conduct Authority (FCA) is a financial regulation, financial regulatory body in the United Kingdom, but operates independently of the UK Government, and is financed by charging fees to members of the financial services industry. The ...
. Once a bank has received authorisation in the UK, or another member state, it may operate throughout the
EU under the terms of the host state's rules: it has a "
passport
A passport is an official travel document issued by a government that contains a person's identity. A person with a passport can travel to and from foreign countries more easily and access consular assistance. A passport certifies the personal ...
" giving it
freedom of establishment in the internal market.
Customer rights
![Birmingham Northern Rock bank run 2007](https://upload.wikimedia.org/wikipedia/commons/e/e5/Birmingham_Northern_Rock_bank_run_2007.jpg)
While banks perform an essential economic function, supported by public institutions, the rights of bank customers have generally been limited to contract.
Customer accounts
In general terms and conditions, customers receive very limited protection. The
Consumer Credit Act 1974
The Consumer Credit Act 1974c 39 is an Act of the Parliament of the United Kingdom that significantly reformed the law relating to consumer credit within the United Kingdom.
Prior to the Consumer Credit Act, legislation covering consumer credi ...
sections 140A to 140D prohibit unfair credit relationships, including extortionate interest rates. The
Consumer Rights Act 2015
The Consumer Rights Act 2015 is an Act of Parliament of the United Kingdom that consolidates existing consumer protection law legislation and also gives consumers a number of new rights and remedies.
Provisions for secondary ticketing and l ...
sections 62 to 65 prohibit terms that create contrary to good faith, create a significant imbalance, but the courts have not yet used these rules in a meaningful way for consumers. Most importantly, since ''
Foley v Hill
''Foley v Hill'' (1848) 2 HLC 28, 9 ER 1002 is a judicial decision of the House of Lords in relation to the fundamental nature of a bank account. Together with '' Joachimson v Swiss Bank Corporation'' 9213 KB 110 it forms part of the foundatio ...
'' the courts have held customers who deposit money in a bank account lose any rights of property by default: they apparently have only contractual claims in debt for the money to be repaid. If customers did have property rights in their deposits, they would be able to claim their money back upon a bank's insolvency, trace the money if it had been wrongly paid away, and (subject to agreement) claim profits made on the money. However, the courts have denied that bank customers have property rights. The same position has generally spread in banking practice globally, and Parliament has not yet taken the opportunity to ensure banks offer accounts where customer money is protected as property.
Deposit protection
Because insolvent banks do not enable customers to recover their money as a
property right
The right to property, or the right to own property (cf. ownership) is often classified as a human right for natural persons regarding their possessions. A general recognition of a right to private property is found more rarely and is typically h ...
(only
contract
A contract is a legally enforceable agreement between two or more parties that creates, defines, and governs mutual rights and obligations between them. A contract typically involves the transfer of goods, services, money, or a promise to tran ...
), governments have found it necessary to publicly guarantee depositors' savings. This follows the model, started in the
Great Depression
The Great Depression (19291939) was an economic shock that impacted most countries across the world. It was a period of economic depression that became evident after a major fall in stock prices in the United States. The economic contagio ...
, the US set up the
Federal Deposit Insurance Corporation
The Federal Deposit Insurance Corporation (FDIC) is one of two agencies that supply deposit insurance to depositors in American depository institutions, the other being the National Credit Union Administration, which regulates and insures cred ...
, to prevent
bank run
A bank run or run on the bank occurs when many clients withdraw their money from a bank, because they believe the bank may cease to function in the near future. In other words, it is when, in a fractional-reserve banking system (where banks no ...
s. In 2017, the UK guaranteed deposits up to £85,000, mirroring an EU wide minimum guarantee of €100,000.
Markets
Insolvency
Because of the knock-on consequences of any bank failure, because bank debts are locked into a network of international finance, government has found it practically necessary to prevent banks going insolvent. This system began with the
Banking (Special Provisions) Act 2008
The Banking (Special Provisions) Act 2008 (c 2) is an Act of the Parliament of the United Kingdom that entered into force on the 21 February 2008 in order to enable the UK government to nationalise high-street banks under emergency circumstances ...
, emergency legislation for the nationalisation of
Northern Rock
Northern Rock, formerly the Northern Rock Building Society, was a British bank. Based at Regent Centre in Newcastle upon Tyne, United Kingdom, Northern Rock was originally a building society. It demutualised and became Northern Rock bank in ...
, which was recast the following year. Under the
Banking Act 2009
The Banking Act 2009 (c 1) is an Act of the Parliament of the United Kingdom that entered into force in part on the 21 February 2009 in order, amongst other things, to replace the Banking (Special Provisions) Act 2008. The Act makes provision fo ...
if a bank is going into insolvency, the government may (and usually will if "the stability of the financial systems" is at stake) pursue one of three "stabilisation options". The Bank of England will either try to ensure the failed bank is sold onto another private sector purchaser, set up a subsidiary company to run the failing bank's assets (a "bridge-bank"), or for the UK Treasury to directly take shares in "temporary public ownership". This will wipe out the shareholders, but will keep creditors' claims intact.
All other standard rules of the
Insolvency Act 1986
The Insolvency Act 1986c 45 is an Act of the Parliament of the United Kingdom that provides the legal platform for all matters relating to personal and corporate insolvency in the UK.
History
The Insolvency Act 1986 followed the publication and ...
apply, including
wrongful trading
Wrongful trading is a type of civil wrong found in UK insolvency law, under Section 214 Insolvency Act 1986. It was introduced to enable contributions to be obtained for the benefit of creditors from those responsible for mismanagement of the inso ...
provisions, and the rules in the
Company Director Disqualification Act 1986
The Company Directors Disqualification Act 19861986 c. 46 forms part of UK company law and sets out the procedures for company directors to be disqualified in certain cases of misconduct.
History
Lord Millett, in the opinion he gave in , summar ...
.
Capital requirements
One fashionable method to prevent bank insolvencies, following the "
Basel III
Basel III is the third Basel Accord, a framework that sets international standards for bank capital adequacy, stress testing, and liquidity requirements. Augmenting and superseding parts of the Basel II standards, it was developed in response to ...
" programme of the international banker group, has been to require banks hold more money in reserve based on how risky their lending is. EU wide rules in the
Capital Requirements Regulation 2013
The Capital Requirements Regulation''(EU) No. 575/2013is an EU law that aims to decrease the likelihood that banks go insolvent. With the Credit Institutions Directive 2013 the Capital Requirements Regulation 2013 (CRR 2013) reflects Basel III ru ...
achieve this in some detail, for instance requiring proportionally less in reserves if sound government debt is held, but more if mortgage-backed securities are held.
[(EU) No 575/2013, arts 114-134] It is not clear that a lack of capital is the
root cause Root cause may refer to:
* "Root Cause" (''Person of Interest''), a TV show episode
* Root cause analysis
In science
Science is a systematic endeavor that builds and organizes knowledge in the form of testable explanations and predic ...
of the problem, although the
Basel Committee
The Basel Committee on Banking Supervision (BCBS) is a committee of banking supervisory authorities that was established by the central bank governors of the Group of Ten (economic), Group of Ten (G10) countries in 1974. The committee expanded ...
of banks advocates it.
Competition law
*
Competition Act 1998
The Competition Act 1998 is the current major source of competition law in the United Kingdom, along with the Enterprise Act 2002. The act provides an updated framework for identifying and dealing with restrictive business practices and abuse of ...
*
Libor scandal
See also
*
UK company law
The United Kingdom company law regulates corporations formed under the Companies Act 2006. Also governed by the Insolvency Act 1986, the UK Corporate Governance Code, European Union Directives and court cases, the company is the primary legal ...
*
UK enterprise law
United Kingdom enterprise law concerns the ownership and regulation of organisations producing goods and services in the UK, European and international economy. Private enterprises are usually incorporated under the Companies Act 2006, regulated ...
*
Bank regulation in the United States
Bank regulation in the United States is highly fragmented compared with other G10 countries, where most countries have only one bank regulator. In the U.S., banking is regulated at both the federal and state level. Depending on the type of cha ...
*
Glass–Steagall Act of 1933
*
Depository Institutions Deregulation and Monetary Control Act
The Depository Institutions Deregulation and Monetary Control Act of 1980 (, ) (often abbreviated DIDMCA or MCA) is a United States federal financial statute passed in 1980 and signed by President Jimmy Carter on March 31. It gave the Federal Res ...
of 1980
Notes
{{reflist, 2
References
*EP Ellinger, E Lomnicka and CVM Hare, ''Ellinger's Modern Law of Banking'' (2011)
Bank regulation