Financial Services (Banking Reform) Act 2013 (strengthened depositor protection)
What this means for your business
- Applies to
- United Kingdom
- On this page
- 9 compliance obligations, 2 practical guides
What you must do
9 compliance obligations under this legislation — 3 can result in imprisonment.
Management duties 1
Apply to vary a senior‑manager approval condition
If your firm has a senior‑manager approval (under section 59) that carries conditions, you may ask the FCA or PRA to change those conditions. You must submit a formal application to the regulator specifying whether you want to vary, remove or add a condition, and the regulator has up to three months to decide.
Notifications 3
Notify the Bank of England and wait 14 days before winding‑up actions
If you (or your infrastructure company) want to start a winding‑up petition or a voluntary winding‑up, you must first tell the Bank of England about the application. After the Bank receives your notice you must wait a full 14‑day period before the court can consider the petition or approve the resolution.
Notify the Bank of England before enforcing security over infrastructure assets
If your business holds a security over the property of an infrastructure‑company, you cannot take enforcement steps straight away. You must first give the Bank of England written notice of your intention, then wait a full 14 days from the day the Bank receives the notice before you can act.
Notify the Bank of England of Part 26A applications and obtain its consent
Unlimited fineIf your infrastructure company (or its liquidator/administrator) is involved in a Part 26A restructuring or reconstruction, you must tell the Bank of England about any application you plan to make under section 901C(1) of the Companies Act and about any similar application you think a creditor or member may make. You cannot proceed with that application unless the Bank gives its consent, and any documents you send to creditors must also be sent to the Bank.
Payments and fees 1
Pay Treasury‑directed fees on behalf of your regulated firm
If the Treasury decides it needs money to cover the UK’s share of certain international organisations, it can instruct the FCA, PRA or the Bank of England to charge a fee. Your business – if it is an FCA‑authorised firm, PRA‑authorised firm, recognised investment exchange or recognised clearing house – may be required to pay that fee to the regulator as directed.
Offences and prohibitions 3
Destroy or conceal documents relevant to a regulator’s investigation
2 years imprisonmentIf a person knowingly destroys, hides, falsifies or otherwise disposes of documents that are or could be relevant to a Financial Services regulator’s investigation, they commit a criminal offence. Conviction can lead to up to 2 years’ imprisonment or an unlimited fine, or both.
Disclose confidential information in breach of Section 91
2 years imprisonmentIf you reveal confidential information that you are not permitted to share under the Banking Reform Act (section 91), you commit a criminal offence. The same applies if you receive information under regulations made under section 92 and then use it contrary to those regulations. Conviction can lead to up to two years in prison and an unlimited fine (or up to 12 months and a fine on summary conviction).
Make decision that leads to financial institution failure
7 years imprisonmentIf you are a senior manager at a bank or any member of its group and you take, or agree to, a decision about how the group's business is run, know that the decision could cause the group to fail, and you act far below what could reasonably be expected, and the decision does cause the group to fail, you commit a criminal offence. A conviction can lead to up to 7 years’ imprisonment and an unlimited fine (or, for less serious cases, up to 6 months’ imprisonment and a fine in the magistrates’ court).
Reporting and filing 1
Provide documents and information to review panel on request
If a review panel is set up under the Banking Reform Act to examine proprietary trading, your business must let the panel see any documents it reasonably needs and give any explanations the panel asks for. This duty applies whenever the panel makes a request, and you must comply at a reasonable time.
Penalties for non-compliance
4 penalties under this legislation. 3 can result in imprisonment. 4 carry an unlimited fine.
Destroy or conceal documents relevant to a regulator’s investigation
Unlimited fine and/or 2 years imprisonment
Disclose confidential information in breach of Section 91
Unlimited fine and/or 2 years imprisonment
Make decision that leads to financial institution failure
Unlimited fine and/or 7 years imprisonment
Notify the Bank of England of Part 26A applications and obtain its consent
Unlimited fine
Practical guidance
Our guides explain how to comply with the requirements above.
Banking regulation and PRA authorisation
Dual PRA and FCA authorisation requirements for UK banks, including capital requirements, mobilisation routes, and ongoing regulatory obligations under SM&CR …
Payment systems and banking protections for businesses
How the Financial Services (Banking Reform) Act 2013 protects your business through the Payment Systems Regulator, FSCS deposit insurance, and …
Sections and provisions
175 classified provisions from this legislation.
Duties 31
- s.8 Independent review of operation of legislation relating to ring-fencing
- s.9 PRA review of proprietary trading
- s.10 Independent review of proprietary trading
- s.12 Right to obtain documents and information reasonable time
- s.26 Variation of approval
- s.38 Institution of proceedings
- s.44 Designation criteria
- s.45 Procedure
- s.46 Amendment of designation order
- s.47 Revocation of designation orders
- s.48 Publication
- s.49 Regulator's general duties in relation to payment systems
- s.60 Restrictions on exercise of functions under Part 4 of the Enterprise Act 2002
- s.63 Provision of information and assistance to a CMA group
- s.70 Complaints: guidance other matters that appear
- s.74 Warning notices reference
- s.84 Investigations: general
- s.97C Treasury approval The Treasury
- s.99 Memorandum of understanding regulator in relation
- s.104E Report on certain reviews amendments need
- ... and 11 more duties
Offences and penalties 3
Powers 35
- s.7 Building societies: power to make provision about ring-fencing
- s.15 Power to require information from scheme manager
- s.17 Bail-in stabilisation option
- s.43 Designation orders
- s.56 Power to require granting of access to payment systems
- s.57 Variation of agreements relating to payment systems
- s.58 Power to require disposal of interest in payment system
- s.62 Duty to consider exercise of powers under Competition Act 1998
- s.69 Response by Regulator
- s.72 Publication of compliance failures etc
- s.73 Penalties
- s.75 Injunctions
- s.76 Appeals: general
- s.77 Appeals to Competition Appeal Tribunal
- s.78 Appeals in relation to penalties
- s.79 Appeals to Competition and Markets Authority
- s.80 Enforcement of requirement to dispose of interest in payment system
- s.81 Power to obtain information or documents
- s.82 Reports by skilled persons
- s.83 Appointment of persons to conduct investigations
- ... and 15 more powers
Definitions 31
- s.4 Ring-fencing of certain activities ring-fenced body the ring-fencing provisions UK institution
- s.11 Reviews of proprietary trading: interpretation Relevant authorised person UK institution insurer
- s.13 Preferential debts: Great Britain eligible deposit deposit
- s.31 Requirement to notify regulator of disciplinary action The appropriate regulator
- s.37 Section 36: interpretation Financial institution UK institution insurer
- s.40 The Payment Systems Regulator
- s.41 Meaning of “payment system” payment system digital settlement asset securities settlement system
- s.42 Participants in payment systems etc
- s.50 The competition objective
- s.53 Regulatory principles
- s.54 Directions
- s.55 System rules
- s.71 Meaning of “compliance failure” compliance failure
- s.85 Powers of persons appointed under section 83 investigator specified
- s.91 Restrictions on disclosure of confidential information confidential information
- s.92 Exemptions from section 91 specified
- s.96 Guidance general guidance
- s.97A Technical standards EU tertiary legislation
- s.98 Duty of regulators to ensure co-ordinated exercise of functions Relevant functions Objectives the interchange fee regulation
- s.102B Matters to consider when imposing generally applicable requirements Specified
- ... and 11 more definitions
Exemptions 15
- s.29 Certification of employees by relevant authorised persons
- s.59 The Regulator's functions under Part 4 of the Enterprise Act 2002
- s.61 The Regulator's functions under the Competition Act 1998
- s.65 Exclusion of general duties
- s.94 Information received from Bank of England
- s.102A Recommendations by Treasury in connection with general duties
- s.103 Regulator's general duty to consult
- s.104H Statement of policy in relation to cost benefit analyses
- s.104D Requirement to review specified requirements
- s.104G Consultation with the FCA Cost Benefit Analysis Panel
- s.108 Relationship with Part 8 of the Payment Services Regulations 2017
- s.123 Restriction on making of ordinary administration orders
- s.126 Indemnities
- s.142 Orders and regulations: general
- Schedule 4 The Payment Systems Regulator