The BoE has published its second assessment of the resolvability of the eight major UK banks, finding that the banks have made significant progress in preparation for resolution, and have addressed issues outstanding from the first assessment in 2022.
The assessment found that these major banks would be able to enter resolution safely and continue to provide vital services, with shareholders and investors primarily bearing the costs of failure. Areas of progress included:
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assurance arrangements – firms have enhanced their governance processes to monitor resolution capabilities, and have implemented strong testing arrangements;
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adequate financial resources – banks continue to meet the minimum requirement for own funds and eligible liabilities, and have continued to reduce the stock of certain legacy capital instruments which could pose a risk to the execution of resolution;
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continuity and restructuring – firms have implemented systems that chart their critical service provi