THE UK is the only major Western country so far to approve temporary public ownership of collapsing banks, a report by law firm Clifford Chance shows.
In a comparison of resolution regimes, which allow a regulator to take over and wind up failing financial institutions instead of bailing them out, Clifford Chance determined the UK is the only jurisdiction, out of the US, Germany and the European Commission, that will allow “temporary public ownership” of a failing bank.
The UK is also unusual in not opting for a “pre-funded” regime, whereby a levy on banks would fund the costs of administering a resolution procedure. Instead, George Osborne is using the UK bank levy for general spending.
However, the regimes devised so far are not final and details could change.