UK Bank Ring-Fencing Legislation

What is Bank ring-fencing?

Published by HM Treasury, the Bank ring-fencing legislation will be fully enforced from 1st January 2019, but what exactly does the ring-fencing legislation entail?

Following the global financial crisis that started in 2007 the Government developed legislation to fundamentally change how banks are run as well as strengthen the UK financial system. The Financial Services (Banking Reform) Act 2013 introduced the notion of ring-fencing as recommended by the Independent Commission on Banking. Details of the regime are set further into legislation that was passed in 2014, 2015 and 2016 and through the rules of the city regulators – the PRA and FCA. Links to the various ring-fencing legislation can be found below in our useful reading and links section to the side.

In essence, the rules require that the largest UK banks must separate the provision of their core retail banking services from their other activities such as investment and international banking. The ring-fencing of activities within Banks, otherwise known as structural reform by the PRA, must take place in the biggest of the UK’s Banks by the start of 2019.

Background: Why ring-fence?
Which Banks are affected by the ring-fencing rules
Which services are affected by ring-fencing in banks?
Client Money & Ring-Fencing: What you must do

What is Client Money?

Client Money Support & Compliance Assistance

Compound Growth can assist firms of all sizes to ensure they have the necessary procedures in place to remain compliant with the regulator’s rules pertaining to client money and client assets as set out in the CASS Sourcebook.

In particular we can support your firm in establishing suitable accounting systems as well as developing client money policies in line with industry best practice and the FCA’s guidance.

If you would like to discuss client money or client assets further, please feel free to contact us or email enquiries@compoundgrowth.co.uk.

Client Money Segregation

Ring-Fencing Deadline

The UK’s biggest banks must comply with all aspects of the ring-fencing legislation by 2019.

Client Money News

Useful Reading & Links:

Client Assets Protection Regime What is Client Money?Core Principles Segregation Letter of Trust Regulatory Fines Client Money & Assets Resolution Pack (CASS RP)Client Money & Assets Reporting (CMAR)Client Money: Annual classification and notification CASS Firm Types: CASS Large Firms vs CASS Medium Firms CMAR Questions Client Money Accounts & Bank Ring-Fencing Client Money & Unbreakable Deposits

UK Bank Ring-Fencing Legislation Which services are affected by ring-fencing?Which banks are affected by the ring-fencing rules?Why ring-fence?

Government Report on Changes to Client Money & Unbreakable Deposits