A guide to the Banking Bill 2008

Abstract

The Banking Bill 2008 was introduced into Parliament in October 2008 in response to the financial crisis of 2007–2008, and came following a series of consultations published by the Government during 2007 and 2008. The Bill has the overall objective of enhancing financial stability and improving depositor protection, and includes a raft of new powers, including tools the UK tripartite authorities can use to deal with failing and failed banks – known as the Special Resolution Regime (SRR). Following the failures of Northern Rock and Bradford and Bingley a number of new tools are proposed to deal with failing banks. Some of the tools proposed, principally the “partial transfer” powers, have proved controversial due to the effect they could have on stakeholders' private law rights during a bank insolvency or rescue. The Government has proposed a safeguard order and a code of conduct to meet concerns, but many feel the Government must go further if they are to prevent rising costs for UK banks and further financial instability.