Changes to the Investment Bank Special Administration Regime

7 June 2017

Changes to the Investment Bank Special Administration Regime

In Changes to the Investment Bank Special Administration Regime: problems solved? (Journal of International Banking and Financial Law March 2017) Sarah Bayliss examines the changes to the special administration rules which came into force on 24 April 2017.  The special administration procedure is available to any company obliged to be authorised by the FCA/PRA and so applies to a wide variety of companies from banks, investment entities and financial advisers to insurance, pension and mortgage providers and consumer credit firms. The special administration regime aims to expedite the return of customers’ assets and encourage co-operation with the relevant authorities. Although companies qualifying for special administration can still elect to go into ‘ordinary’ administration under Schedule B1 of the Insolvency Act 1985, the advantage of special administration is the framework provided concerning the administrator’s dealings client assets. That is particularly so following the changes to, and amplification of, the provisions dealing with client assets in the new rules. For that reason it is likely that special administration will usually be the more appropriate option for an authorised firm considering administration.  

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Legal update written by Sarah Bayliss of XXIV Old Buildings