(1) An issuer of a regulated covered bond must enter into arrangements with the owner of the relevant asset pool for the maintenance and administration of that pool.

(2) The arrangements must provide for the following requirements -

(a) a record is kept of each asset in the asset pool;

(b) the asset pool is, during the whole period of validity of the regulated covered bond, capable of covering -

(i) claims attaching to the bond; and

(ii) sums required for the maintenance, administration and winding up of the asset pool;

(c) there is timely payment of claims attaching to the bond to the regulated covered bond holder;

(d) the asset pool is of sufficient quality to give investors confidence that in the event of the failure of the issuer there will be a low risk of default in the timely payment by the owner of claims attaching to the bond;