BANKING & FINANCE LITIGATION UPDATE

ISSUE 82

We wish to establish a dialogue with our readers. CONTENTS Please contact us at &FL Update and let us know Domestic Banking 2 which particular areas you are interested in and what you would find helpful. Domestic General 3 The Banking & Finance Litigation Update is European Banking 5 published monthly and covers current developments European General 6 affecting the Group's area of practice and its clients International Banking 6 during the preceding month. International General 7 This publication is a general overview and discussion of the subjects dealt with. It should not be used as a Press Releases 8 substitute for taking legal advice in any specific situation. DLA Piper UK LLP accepts no responsibility for any actions taken or not taken in reliance on it. Where references or links (which may not be active links) are made to external publications or websites, the views expressed are those of the authors of those publications or websites which are not necessarily those of DLA Piper UK LLP, and DLA Piper UK LLP accepts no responsibility for the contents or accuracy of those publications or websites. If you would like further advice, please contact Paula Johnson on 08700 111 111.

DOMESTIC BANKING customers and has already created a website for the brand. 1. The Bank of England has announced a major Telegraph, 15 December 2014 change to its monetary policy arrangements. The changes, which will be implemented from 2016, 7. , the insurance arm of Lloyds will mean there will only be eight decisions made Banking Group, is to sell its offshore investment on interest rates each year, rather than 12. and tax planning business which is based in the Isle of Man. Those with knowledge of the process Financial Times, 12 December 2014 have indicated that there are a number of parties interested in the sale of the entity which is 2. The Financial Times has reported that the Bank of responsible for around £5 billion of funds. England began an investigation into possible market manipulation by its own staff in the Financial Times, 1 December 2014 summer. The bank is trying to ascertain whether its employees knew about or facilitated the 8. is to "simplify" its range of manipulation of money-market auctions which savings accounts offered by its three entities occurred during the financial crisis. Lloyds, and . The group is to replace 47 old accounts, which are no longer thetimes.co.uk, 22 November 2014 open to the public, with just three savings accounts paying 0.25 per cent interest. The change will mean that a third of Lloyds existing customers with the accounts will see their income drop as a 3. As part of its plan to cut the number of branches it result of rate cuts. operates to reduce costs, Barclays is to introduce a home-based system whereby customers will be Telegraph.co.uk, 26 November 2014 able to talk to staff about issues via a "Skype- like" system instead of having a face-to-face THE interview. 9. Current account customers with The Royal Bank Sunday Telegraph, 30 November 2014 of Scotland ("RBS") have been getting unexpected letters from the lender informing them that their CO-OPERATIVE BANK debit cards need to be replaced as they have been "compromised". This is happening even where 4. The Co-operative Bank has had its financial customers have not lost cash nor observed any strength deemed as inadequate after failing Bank suspicious activity on their accounts. The lender of England stress tests. The tests have forced the said the move was part of a trial launched in the Co-op to accelerate its plans to improve its summer with the intention of eradicating card finances. Details of its new capital plan have been fraud before it happens. It did not reveal the approved by the Bank of England. number of customers who were being contacted. Telegraph, 16 December 2014 Telegraph.co.uk, 18 December 2014

LLOYDS BANKING GROUP 10. Bloomberg has reported that RBS intends to 5. The government has made a surprise withdraw from fixed-income trading in Japan and announcement that it plans to sell up to 5.4 per reduce employees from approximately 200 to cent of its remaining stake in Lloyds Banking lower than 50. It is anticipated that RBS Group over the next six months. The sale, which Securities Japan will relinquish its primary could be worth £3 billion, would leave the dealership and executives of RBS are said to be government with less than 20 per cent of the bank scheduled to meet shortly with officials from the in its possession before the next general election. Financial Services Agency to detail the proposal for closure. Telegraph, 18 December 2014 Independent.co.uk, 10 December 2014 6. The dormant Bank of name has been purchased by Lloyds Banking Group along with 11. Intesa Sanpaolo, the Italian lender, has announced the Banc Cymru name. Lloyds is hoping to use that it will only bid for the wealth management the names to market savings products to new operation of RBS if the unit is sold in its entirety.

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The UK lender is looking to sell the international Telegraph, 29 November 2014 division of only.

Telegraph, 29 November 2014 DOMESTIC GENERAL

12. The Prudential Regulation Authority (PRA) has 16. The Serious Fraud Office has confirmed that a uncovered a mistake in RBS's core capital ratio man in Billericay, Essex, has been arrested. His which it says has been "overstated" by £4 billion. arrest is thought to be the first in connection with RBS has admitted the error, which came to light an investigation into attempts to rig the foreign during analysis by the PRA of the European exchange market. £2.7 billion worth of fines were Banking Authority's stress test results, and may handed to six banks in November, in connection face a financial penalty as a result. with rigging allegations.

Times, 22 November 2014 Telegraph, 20 December 2014

STANDARD CHARTERED 17. As it continues its work on the 2015 edition of its stress tests, the Bank of England has made it clear 13. A new group has been set up by Standard that banks are likely to be tested on their ability to Chartered to fight financial crime as it tries to withstand a shock emanating from what are convince regulators in America that it is taking known as "emerging markets". The banks which radical action so that scandals in relation to could be most tested by such a focus would be sanctions-busting and money-laundering do not HSBC and , with their happen again. The financial crime risk committee presence in Asia, and Barclays, which has a will be made up of senior directors and growing business in Africa. knowledgeable external advisers to eradicate misconduct and to assure the US authorities that Independent, 17 December 2014 the terms of a deferred prosecution agreement will be met, the lender said. 18. Bank of England "stress" tests on eight high street banks have found three of them - the Co- thetimes.co.uk, 11 December 2014 Operative Bank, Lloyds Banking Group and RBS - lacking in financial strength. The five others - 14. Following a settlement in 2012 between Standard Barclays, HSBC, Standard Chartered, Santander Chartered and the US Department of Justice with UK and the Nationwide building society - did not regard to money laundering violations, the have any capital inadequacies. Of the three banks regulator has extended its deferred prosecution shown to have some issues, only the Co-op Bank agreement with the bank until the end of 2017, was ordered to prepare a revised plan being the saying it had not yet "reached the standard only bank to fall below a minimum core tier one required" in an acceptable compliance capitalisation that had been set by the Bank of programme. England.

Telegraph, 10 December 2014 Guardian.com, 16 December 2014

15. Credit ratings agency Standard & Poor's has 19. Following months of negotiations with the downgraded its rating on Standard Chartered for Treasury, nine high street banking groups - the first time in two decades, considering it to be Barclays, HSBC, Co-operative Bank, Lloyds, less creditworthy as a result of a series of profit Nationwide, RBS, Santander, TSB and NAB warnings and increased charges on loans. The (owner of and ) - lender's long-term debt has been cut from AA- to have agreed to offer basic bank accounts with no A+ and its short term debt from A-1+ to A-1. charges for failed payments. The banks also agreed to provide all account holders with debit cards and full access to the UK's main cash machine network, services previously charged for or unavailable to many basic account customers. The deal was welcomed by consumer groups.

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Times, 16 December 2014 Telegraph, 10 December 2014

20. The Financial Conduct Authority ("FCA") has 25. With banks becoming increasingly concerned over proposed a ban on banks and other financial the rising level of penalties being levied against services firms from directing customers who wish them and the impact this could have on their to complain or get some advice to premium-rate capital, the FCA is to conduct a review of its phone numbers. Under the proposals the banks penalty regime. Investigations into possible would not be able to charge anything over the rigging of the foreign market and the Libor basic rate. Currently many banks offer new interest rate benchmark, have seen FCA fines customers a Freephone number, but switch reach record levels, with £1.39 billion in fines existing customers to premium-rate numbers. handed out since April 2014, more than three times the previous high amount for a whole year Times, 13 December 2014 period.

21. Under new powers which came into force on 12 Financial Times, 8 December 2014 December 2014, fines or even criminal penalties could be handed to any banks or building societies 26. The past year has seen a jump in bank overdraft which allow current accounts to be opened by charges, with the average customer rate having known illegal immigrants. The bank account increased by 11 per cent, according to Bank of move is part of a strategy by the Home Office England figures. This is despite a period of record which aims to make life in the UK more difficult low funding costs for banks, which has meant falls for those foreigners who do not have visas. in savings and other borrowing rates.

Financial Times, 12 December 2014 Sunday Telegraph, 7 December 2014

22. New guidelines which are being developed by the 27. British banks have been surprised by chancellor financial industry and the FCA, could see bankers George Osborne's move in his Autumn Statement having social media behaviour included in their to launch a crackdown on their ability to off-set employment contracts. The finance industry has future tax bills by using post-2008 financial crisis been slow to adopt popular social media losses. Osborne called it "totally unacceptable" platforms, but this is changing with the industry's that, due to the level of so-called deferred tax launch of The Social Media Charter, a set of assets held on their balance sheets, "some banks standards aimed at helping to avoid any future would not pay any tax for 15 to 20 years." The embarrassing incidents. move will, over the next five years, raise around £3.5 billion in extra tax. Foreign banks whose UK Financial Times, 12 December 2014 arms hold large amounts of deferred tax assets could be affected by the crackdown. 23. The commissioner of the City of London Police, Adrian Leppard, who has national responsibility Financial Times, 4 December 2014 for tackling fraud, has said that, for the first time, banks must be made to report the full extent of 28. Shawbrook, established in 2011, financial crime to the authorities. Mr Leppard said has hired investment banks Goldman Sachs and that the failure by the financial industry to give Bank of America Merrill Lynch, as it prepares for proper notification about incidents, meant that the a 2015 float on the London Stock Exchange. criminals involved were being allowed to get off Going public would enable the bank to have an "scot free". Once compensation has been paid to acquisitions currency, raise fresh capital and use customers banks prefer to keep any fraud details share awards as an incentive for staff. confidential, leaving millions of incidents unreported. Times, 4 December 2014

Telegraph, 11 December 2014 29. The Treasury and the Bank of England have issued a joint statement in which chancellor 24. Rating agency Standard & Poor's has claimed that George Osborne announced his intention to extend the ring-fencing regime due to be imposed on the the Funding for Lending Scheme (FLS), which UK's five biggest high-street banks by the Bank of was set to end in January 2015. The cheap credit England, could end up relegating their investment will only be available to banks if it is used to banking divisions to "junk" status. In order to support small businesses. So far the FLS, which protect customers from risky activity the banks has seen £48 billion drawn down by lenders, has must, from 2019, place their retail and trading not led to an increase in the level of net lending to operations in separate subsidiaries. small business.

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Times, 3 December 2014 Financial Times, 17 November 2014

30. The chairman of Metro Bank, Vince Hill, has 36. As regulators look to improve their understanding criticised the technology systems used by of the "culture" at investment banks, as well as incumbent banks, describing them as how bankers in the City carry out their business on "horrendous". Hill, who co-founded the a day-to-day basis, the FCA has begun holding challenger bank, said that the banking industry unscheduled site visits with bankers and traders in compared unfavourably to the high standards an effort to ensure employees are not coached to reached by other industries when it came to give certain answers ahead of interviews. technology. Times, 17 November 2014 Financial Times 28 November 2014 31. A report by the think-tank New City Agenda has EUROPEAN BANKING found that retail banks have made provision for COMMERZBANK £38.5 billion worth of fines and compensation since the turn of the century, and since the 37. Commerzbank will begin charging negative financial crisis of 2008 they have received over 20 interest on big deposits. For the moment million complaints. The report also said that it the charges will not be levied on private would take a generation before the public regained customers, only on "single large corporate clients the trust in banks lost as a result of the financial with high balances" in addition to "large crisis and various mis-selling scandals. corporations and institutional investors". The rate at which penalty interest is charged will be Telegraph.co.uk, 26 November 2014 discussed with individual clients. The charges could apply from as early as December. 32. Investors and companies have suggested that the FCA's plan to change equity research would result Telegraph, 21 November 2014 in a reduction of liquidity and analyst coverage which in turn would limit the effectiveness of CREDIT SUISSE small companies trying to raise money through 38. The owner of the Daily Express and OK! IPOs on the stock market. magazine has settled with two City giants in a £42 million court case regarding a derivative swap he Financial Times, 25 November 2014 claimed was "incomprehensible". In a joint 33. The Treasury is to drop its challenge to EU rules settlement with Credit Suisse and hedge fund on a bonus cap following a ruling from the group GLG, Richard Desmond is understood to advocate-general of the European Court of Justice have won a considerable amount, believed to that Britain's challenge had "no legitimate be over £10 million. A trial had been scheduled grounds". for January 2015.

Times, 21 November 2014 Independent, 18 December 2014

34. Lawyers and banking industry figures have DEUTSCHE BANK warned that plans from Bank of England governor 39. Deutsche Bank has completed its withdrawal from Mark Carney to force bankers who misbehave to the buying and selling of physical commodities pay back their salaries, and not just bonus following investigations by authorities that it had payments, could clash with the EU's bonus cap participated in alleged abuse. The bank has ended and could face serious legal challenges. Mr its involvement in trading in precious metals and Carney has expressed an interest in "performance follows other banks, such as Barclays, JP Morgan bonds" being used to pay bankers. and Morgan Stanley on reducing or withdrawing from the commodities trading sector. Telegraph, 18 November 2014 Financial Times, 28 November 2014 35. In a new report, MPs from the Parliamentary Committee on Banking Standards have said that EUROPEAN more bank employees, including more staff in the 40. In a move that will bring it more into line with mid-tier, should be subjected to a tougher pay other central banks, the European Central Bank regime by regulators. The report argues that the ("ECB") has confirmed that, from January 2015, it current rules need to be broadened as they apply to too few.

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intends to publish accounts of its monetary policy the UK general election in May 2015. Alain deliberations. Bokobza, head of the bank's global asset team has warned that much of Britain's growth is driven by Financial Times, 19 December 2014 excess leverage and a housing bubble and that "this is due to lax monetary policy that needs 41. Whilst uncertainty remains over the impact that tightening". plummeting oil prices will have, the ECB has outlined a wait-and-see approach to pumping Telegraph, 3 December 2014 money into the eurozone's struggling economy. Officials have "stepped up" preparations for a stimulus, according to ECB president Mario EUROPEAN GENERAL Draghi, but the bank is waiting to see if the 46. A lawsuit has been filed at the European Court of economy is improved by spending over the Justice by a group of investors who lost hundreds Christmas period. A bond-buying programme of millions of euros when Banco Espírito Santo could be started at the ECB meetings in January or collapsed. The suit challenges the decision by the March if deflationary pressures in the Eurozone European Commission to approve a bailout by the economies are reinforced by the drop in the oil Portuguese state. Brazilian investment bank BTG price. Pactual, hedge fund Third Point, and the other Times, 5 December 2014 investors have previously filed a legal challenge over the lender's restructuring. The main entity SANTANDER left after the restructuring, Novo Banco, is due to be sold off by Portugal, but the new lawsuit could 42. Santander UK has issued a convertible debt worth cast doubt on the sale. £300 million to its Spanish parent Company to strengthen its capital position Financial Times, 15 December 2014 ahead of further stress tests from the Bank of England next year. It is expected that the stress 47. A failure to reach an agreement on the basic tests in 2015 will look at banks' accounts as they elements of a proposed financial transactions tax stand at the end of December 2014 to assess their by the end of 2014, ahead of its proposed start in financial strength. 2016, means it is likely that the EU's 'Tobin' tax will be postponed, possibly indefinitely. Sunday Telegraph, 21 December 2014 Times, 9 December 2014 43. Santander UK has announced that Baroness Vadera will join its board on 1 January 2015 as 48. A referendum in Switzerland has seen voters joint deputy chairwoman and replace the current overwhelmingly reject proposals that would have chairman, Lord Burns, on 30 March 2015. The forced the Swiss National Bank to hold 20 per cent former investment banker will be the first woman of its assets in gold. The rejection, by 77 per cent chair of a British bank. of voters, has given the National Bank space to protect the Swiss franc against an ECB blitz of Times, 13 December 2014 quantitative easing.

44. After recently taking over as executive chairman, Telegraph, 1 December 2014 Ana Botín has put her stamp on Santander. Chief financial officer José Antonio Álvarez will replace Javier Marín, who is leaving the Spanish lender, as INTERNATIONAL BANKING chief executive effective from 1 January 2015. The position of lead independent director will be BANK OF AMERICA filled by Bruce Carnegie-Brown, a non-executive 49. A move by George Osborne in his Autumn director of the lender's British arm, Santander UK, statement to reduce the amount of corporation tax when Ms Botín was at the helm. banks can avoid, intended to recoup money from the bailed-out banks Lloyds and RBS, will also Times, 26 November 2014 affect Bank of America. Unusually for a foreign bank, Bank of America has $7 billion of deferred SOCIETE GENERALE tax losses in the UK resulting from its purchase of 45. Societe Generale has advised its clients to Merrill Lynch in 2009. liquidate British assets and dump sterling before

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Times, 8 December 2014 Financial Times, 21 November 2014

CITIGROUP 50. Citigroup has set aside £1.7bn in anticipation of INTERNATIONAL GENERAL regulatory fines related to manipulation of the 55. In a move which is largely symbolic, restrictions foreign exchange market, Libor and money on market access for foreign banks have been laundering. Michael Corbat, the bank's chief loosened by China, as it looks to make good on executive, announced the provision at a financial earlier promises to allow more competition in its conference in New York. domestic financial sector. The waiting period for foreign banks to make an application to conduct Telegraph, 10 December 2014 renminbi business once they establish operations in China, has been reduced from three years to CLOSE BROTHERS one, with a two consecutive years of profitability 51. Close Brothers has said that another rise in requirement dropped. Foreign currency business is business lending has counterbalanced the tough restricted for those foreign banks not in possession conditions in its market-making operation keeping of a renminbi licence. it on track for the year. The merchant banking group attributed an increase of 2.3 per cent in its Financial Times, 22 December 2014 loan book to £5.4 billion in the three months to the end of October to robust demand for property and 56. The US Financial Industry Regulatory Authority asset finance. Reduced funding costs are also has handed out fines totalling more than $40 making its margins better while the level of bad million to ten banks over breaches of conflict of interest rules, after the banks - either implicitly or debts dropped. explicitly - promised Toys "R" Us better research Telegraph.co.uk, 20 November 2014 coverage by their market analysts in exchange for a place on the retailer's stock market listing in GOLDMAN SACHS 2010. The float did not go ahead. 52. John Waldron, who worked on the Fox and News Times, 12 December 2014 Corp demerger, has been appointed as co-head of investment banking by Goldman Sachs. He 57. Benjamin Lawsky, head of the New York replaces John Weinberg, who is moving to a new Department of Financial Services is to write to post at the bank. banks with a New York state charter or licence, including Barclays, Deutsche Bank and Standard Independent, 20 December 2014 Chartered, asking them to look on cyber security as a key part of their overall risk management NATIONAL AUSTRALIA BANK strategy. The banking regulator is to issue new 53. National Australia Bank, which has signalled it guidance that will include increased scrutiny of intends to withdraw from the UK market, is banks' cyber security procedures. reported to have appointed Morgan Stanley to lead a flotation of subsidiaries Yorkshire Bank Financial Times, 10 December 2014 and Clydesdale Bank which could value the banks at over £2bn in total. A flotation could be 58. Following the most comprehensive review of the delayed by the 2015 UK general election and low country's financial systems since 1997, the appetite for listings. Australian government has told the country's banks that, in order to make sure they are Sunday Times, 23 November 2014 "unquestionably strong" and robust enough to survive any future financial crisis, they need to NOMURA hold extra capital running to billions of dollars. The review also recommended that, to make 54. Jeremy Bennett has stepped down as Nomura's competition easier for new entrants and smaller European CEO. Yasuo Kashiwagi will take over banks, extra capital on mortgage lending should be as acting European CEO. set aside by Australia's four "pillar banks".

Financial Times, 8 December 2014

59. As banks look to crack-down on staff behaviour which could be illegal, they are moving away from traditional monitoring systems and instead looking

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to state of the art surveillance software, new data Telegraph, 17 November 2014 sources and behavioural science. This follows the use by regulators of the analysis of electronic messages to help them catch bankers accused of PRESS RELEASES rate-rigging. 66. FCA to regulate seven additional financial benchmarks Financial Times, 1 December 2014 The FCA will regulate seven additional major UK 60. As a result of the recent drop in oil prices, a -based financial benchmarks in the fixed income, number of banks, including Barclays and Wells commodity and currency markets from 1 April Fargo, could experience huge losses from an $850 2015. This extends the FCA’s initial regulation of million loan made by the banks to two oil and gas LIBOR (the London Interbank Offered Rate), as companies. introduced by HM Treasury in 2013, and Financial Times 27 November 2014 implements the recommendations of the Fair and Effective Markets Review. 61. Diamond Bank, one of the biggest banks in Nigeria, has sold an 18 per cent share to the Financial Conduct Authority, 22 December 2014 private equity house Carlyle Group for £150 http://www.fca.org.uk/news/fca-to-regulate-seven- million. additional-financial-benchmarks

Financial Times, 25 November 2014 67. Chancellor confirms manipulation of key FOREX benchmark to be made a criminal 62. With penalties for misconduct soaring, the year to offence the end of September 2014 saw the US Department of Justice collect a record $24.7 The Chancellor George Osborne has confirmed billion in fines on behalf of itself and other US that the government will extend the legislation regulators, compared to $8 billion in 2013 and $13 originally put in place to regulate LIBOR to cover billion in 2012. seven further financial benchmarks, including the main foreign exchange benchmark, with those Times, 20 November 2014 found guilty of manipulating these benchmarks facing up to seven years in prison. 63. Following a review by the Australian Securities and Investment Commission, seven staff involved HM Treasury, 22 December 2014 in a regulatory investigation looking at benchmark https://www.gov.uk/government/news/chancellor- interbank interest rate fixing have been suspended confirms-manipulation-of-key-forex-benchmark-to-be- by Australia and New Zealand Banking Group. made-a-criminal-offense

Telegraph, 20 November 2014 68. Government makes recommendations to strengthen financial regulators’ enforcement 64. In one of the most significant moves by China in a decisions decade in terms of the opening of the country's capital account, the Shanghai-Hong Kong Stock The government has published a number of Connect has been launched. The trade channel recommendations to ensure that the way the will enable wealthy Chinese investors to trade financial regulators, the FCA and the PRA make hundreds of stocks in Hong Kong, giving greater enforcement decisions continues to be fair, freedom with regard to overseas investments. transparent and efficient, following a review.

Financial Times, 17 November 2014 HM Treasury, 18 December 2014

65. Bank of England governor Mark Carney has https://www.gov.uk/government/news/government-makes warned private equity firms, hedge funds and -recommendations-to-strengthen-financial-regulators- other areas of the unregulated "shadow banking" enforcement-decisions sector that the next year will see them being closely scrutinised by financial regulators, due to 69. Government to sell part of its remaining concerns over the risks they may pose to financial shareholding in Lloyds through a trading plan. stability. The Chancellor has set out the next stage in the government’s plan to return Lloyds Banking Group to private ownership and get taxpayers’ money back, by announcing that the government

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will sell part of its remaining shareholding in the firm through a trading plan. The Bank of England’s Monetary Policy Committee has voted to maintain Bank Rate at 0.5 HM Treasury, 17 December 2014 per cent. The Committee also voted to maintain https://www.gov.uk/government/news/government-to-sell the stock of purchased assets financed by the -part-of-its-remaining-shareholding-in-lloyds-through-a- issuance of central bank reserves at £375 billion. trading-plan Bank of England, 4 December 2014 70. Bank of England announces results of UK http://www.bankofengland.co.uk/publications/Pages/ stress test news/2014/012.aspx

The Bank of England has announced the results of 74. Funding for Lending Scheme: Bank of England the first concurrent stress testing exercise of the and HM Treasury announce extension UK banking system. Alongside the stress test publication, the Bank of England also published The Bank of England and HM Treasury have its Financial Stability Report, which sets out the announced a one-year extension to the Funding Financial Policy Committee’s assessment of the for Lending Scheme (FLS). This extension will outlook for the stability and resilience of the provide lenders with continued certainty over the financial sector, and the Systemic Risk Survey, availability of cheap funding to support lending to which quantifies and tracks market participants’ small and medium-sized enterprises (SMEs) perceptions of systemic risks. during 2015, even in the event of stress in bank funding markets. Bank of England http://www.bankofengland.co.uk/publications/Pages/ HM Treasury & Bank of England, 2 December 2014 news/2014/169.aspx https://www.gov.uk/government/news/funding-for- lending-scheme-bank-of-england-and-hm-treasury- 71. Bank of England announces results of UK announce-extension stress test 75. FCA publishes terms of reference for credit Chancellor of the Exchequer, George Osborne, card market study has welcomed Mark Carney’s proposals to The FCA has published the terms of reference for strengthen transparency and accountability of the a credit card market study. The FCA announced Bank of England, and the recommendations of the the market study in April 2014 after its own Warsh review to improve decision making and research showed that the credit card market was transparency of the Monetary Policy Committee. not working well for some consumers. HM Treasury, 11 December 2014 Financial Conduct Authority, 25 November 2014 https://www.gov.uk/government/news/bank-of-england- http://www.fca.org.uk/news/fca-publishes-terms-of- proposals-to-bolster-transparency-and-accountability- reference-for-credit-card-market-study welcomed-by-chancellor 76. PRA fines RBS, Natwest Bank and 72. Bank of England announces measures to £14 million for IT failures bolster transparency and accountability The PRA has fined RBS Plc, National The Bank of England has published an Westminster Bank Plc and Ulster Bank Ltd £14 independent report by former Federal Reserve million for inadequate systems and controls which Board Governor Kevin Warsh, following his led to a serious IT incident in 2012. This is the review of the Monetary Policy Committee’s first financial penalty the PRA has imposed since transparency practices and procedures. it came into being in April 2013. The FCA has separately fined the banks for the same incident Bank of England, 11 December 2014 http://www.bankofengland.co.uk/publications/Pages/ Prudential Regulation Authority & Financial Conduct news/2014/168.aspx Authority, 20 November 2014 http://www.bankofengland.co.uk/publications/Pages/ 73. Bank of England maintains Bank Rate at 0.5% news/2014/152.aspx and the size of the Asset Purchase Programme at £375 billion

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77. Historic rupee bond issued in London 80. European banks call on policy makers to show commitment to enabling growth and The government has welcomed the International calibration of regulations Finance Corporation’s announcement that it has issued an Indian rupee 10 billion bond in London. The European Banking Federation (EBF) has It is the largest ever rupee bond to be issued on the stated that the current fixation on tighter and London Stock Exchange, and is the longest issue continuous regulation on banks needs to be set ever for an offshore rupee bond with a maturity of against requirements to boost the economy. EBF 10 years. president Christian Clausen stated that the Board remains firmly opposed to the proposed HM Treasury, 18 November 2014 mandatory separation of trading activities as it https://www.gov.uk/government/news/historic-rupee- would damage both the functioning of the bond-issued-in-london financial sector and the economy.

78. Regulating individual conduct in banking: UK European Banking Federation, 14 November 2014 branches of foreign banks http://www.ebf-fbe.eu/wp-content/uploads/2014/11/EBF- Board-press-release-November-2014-FINAL.pdf A Treasury consultation seeks views on the draft Financial Services and Markets Act 2000 This bulletin is intended as a general overview and (Relevant Authorised Persons) Order 2015, which discussion of the subjects dealt with. It is not would apply the Senior Managers and intended, and should not be used, as a substitute for Certification Regime to UK branches of foreign taking legal advice in any specific situation. DLA credit institutions and to foreign investment firms that carry on the regulated activity of dealing in Piper UK LLP will accept no responsibility for any investments as principal in the UK and are actions taken or not taken on the basis of this regulated by the PRA. Comments by January 30, publication. If you would like further advice, please 2015. contact:

HM Treasury, 17 November 2014 LEEDS: HUGH EVANS https://www.gov.uk/government/consultations/regulating- T 0113 369 2200 individual-conduct-in-banking-uk-branches-of-foreign- banks E [email protected]

79. The FCA and industry agree to improve the LONDON: JEAN-PIERRE DOUGLAS-HENRY way consumer complaints are dealt with T 020 7153 7373 Financial firms have collaborated with the FCA E [email protected] on a thematic review and, as a result, have agreed to make improvements to the way they deal with MANCHESTER: STEWART PLANT consumer complaints. The FCA will be consulting T 0161 235 4544 on possible changes to its dispute resolution rules E [email protected] later.

Financial Conduct Authority, 17 November 2014 http://www.fca.org.uk/news/fca-and-industry-agree-to- improve-the-way-consumer-complaints-are-dealt-with

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