The consultation document is published jointly by the Treasury, the FSA and the Bank of England and will build on previous consultation on financial stability and depositor protection.
Further detail on the specifics of the special resolution regime are outlined in the document along with draft clauses for key aspects of the regime which have attracted particular interest from stakeholders. Proposals raised will be subject to a further period of consultation, prior to the introduction of legislation later in the parliamentary session.
Launching the consultation document, Chancellor Alistair Darling said: “No system of regulation can or should prevent the failure of each and every firm, but we must do everything possible to reduce the impact of problems which could pose a wider threat to stability. The challenge is to ensure that the authorities can act quickly and decisively to take appropriate steps to resolve failing banks. These proposals for a special resolution regime give the authorities the full range of powers they need.”