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09 October 2008

Economic Secretary announces Banking Liaison Group

Ian Pearson MP, the Economic Secretary to the Treasury, today announced that a new expert liaison group on banking will be set up. The group will work with the Government to help prepare new secondary legislation for the special resolution regime (SRR), one of the key proposals in the Government’s new Banking Bill. The group will also have an ongoing remit to keep SRR powers and regulations under review, as practices in the financial markets develop over time.  Chairing a meeting of key industry representatives to discuss the Banking Bill, he said:

"The Treasury has worked closely with business and other groups throughout the process of developing this legislation.  We have met with over 100 organisations, published four discussion and consultation papers and run numerous workshops with experts on specific issues. 

"I am determined that we continue to work closely with business and other experts on these issues.  I am therefore today announcing that we will be setting up a new liaison group.  It will bring together experts to advise the Government on keeping our special resolution regime up to date.  Its most immediate task will be to work with us to develop the initial secondary legislation required to put the regime, and especially the safeguards which the industry has been calling for, into effect." 

The group will include representatives from the banking sector, experts in financial law and insolvency, and members from the Treasury, Bank of England, Financial Services Authority and Financial Services Compensation Scheme.

Notes for editors

1. Ian Pearson, MP for Dudley South, is the Economic Secretary to the Treasury.

2. The Government’s new Banking Bill was introduced into Parliament and received its first reading on 7 October 2008. Second reading will be on 14 October 2008.

3. The Government has, together with the Bank of England and the Financial Services Authority, conducted three rounds of discussion and consultation on the proposals that are contained in the new Banking Bill. Over 200 responses have been received from banks, building societies, insurers and their representative organizations, and bodies representing citizens, consumers, workers, businesses, legal and insurance professionals. Responses were also received from international governmental and financial organisations and from academics and individuals.

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