From Wikipedia, the free encyclopedia
United Kingdom legislation
The
Banking (Special Provisions) Act 2008
(c. 2) is an
Act
of the
Parliament of the United Kingdom
that entered into force on the 21 February 2008 in order to enable the UK government to
nationalise
high-street banks under emergency circumstances by
secondary legislation
. The Act was introduced in order to nationalise the failing bank
Northern Rock
after the bank was supported by
Bank of England
credit and a private-sector solution was deemed "not to provide sufficient value for the taxpayer" by the UK government.
Opposition to the Act by the
Conservatives
was based on: the Bill providing an exemption to the
Freedom of Information Act 2000
, the large liabilities to the taxpayer and the alleged lack of independence from the government. The Bill was also sufficiently widely drawn to allow the nationalisation of any financial institution, leading to the concern that other banks might be in financial difficulty.
[4]
After the
nationalisation of Northern Rock
, the Act allowed for the nationalisation of the mortgage and personal loan book of
Bradford & Bingley
on 29 September 2008.
[5]
On 8 October 2008, the
Treasury
announced that an order under the Act was being used to transfer all retail deposits with
Heritable Bank
, a UK-based banking subsidiary of the failing Icelandic bank
Landsbanki
, and
Kaupthing Edge
to
ING Direct
.
[6]
However section 2(8) of the Act provides that the Treasury may only make Transfer Orders under the Act for a maximum of a year after its passage.
[7]
The Act therefore expired on 21 February 2009, when it was superseded by the
Banking Act 2009
.
List of banks acquired/transferred under the act
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See also
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References
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External links
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