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Banking Bill

This amendment would insert a new clause after Clause 48 requiring a report or annual assessment to be made by the Treasury on partial property transfers. We have spent the past hour or so talking about these transfers and it is clear that important issues arise out of them in connection with set-off, netting and other similar transactions. Even if agreement is reached and harmony breaks out between the Treasury and the banks over the next few weeks over what the terms of the statutory instrument should be, we ought not to be in any doubt that this is difficult territory where people may not have worked out what is exactly the right answer. For example, the British Bankers’ Association is concerned that practical problems and unintended consequences may emerge which need to be dealt with. That is not to challenge the bona fides of the Treasury in conducting and responding to its consultation, but to state a fact of life about this hugely complicated area. The amendment therefore proposes an annual assessment which, although it may appear to be onerous, addresses such an important area that goes to the heart of whether or not transactions work for regulatory capital purposes, possibly actually destroying the market in the UK, that it needs to be set against the damage that could be done to our banking industry. The amendment requires the Treasury to consult the Banking Liaison Panel, the group being brought together for the purpose of looking at secondary legislation, and, importantly, requires it to make proposals for dealing with any aspects that are regarded as unsatisfactory. We have of course included the requirement to publish the assessment and to lay it before Parliament to allow for an appropriate level of involvement should it so choose. I hope that the Government will regard this amendment as a practical way forward. If it is accepted, it would take away some of the concerns about getting everything absolutely right either in Clauses 47 and 48 or in the first statutory instrument that will be made thereunder. At least the industry would be satisfied that there is a genuine intention on the part of the Government to keep this under positive review. I beg to move.