Member

Of course, mutuals have a different ownership model, with no shares, so the use of the power with respect to a mutual would require the firm to be demutualised. That brings me to amendment 2, which would require further detail to be included in the code of practice in relation to demutualisation. Specifically, it would require the Treasury to include guidance in the code in respect of the Bank of England’s exercise of its resolution powers in respect of a building society in circumstances where the use of the recapitalisation power may result in demutualisation. The guidance would require the Bank of England to give due consideration to the impact of such demutualisation on members of the building society in resolution and on the mutual sector, particularly when the Bank of England could select a buyer from the mutual sector to avoid demutualisation. The Bank of England is required to have regard to the code, so would be required to have regard to such new guidance when exercising its resolution powers.