BNY Mellon Corporate Trustee Services Ltd v LBG Capital No 1 plc and another – WLR Daily

Posted June 17th, 2016 in banking, contracts, interpretation, law reports, trusts by tracey

BNY Mellon Corporate Trustee Services Ltd v LBG Capital No 1 plc and another [2016] UKSC 29

‘In March 2009, the financial services regulatory authority conducted a stress test of a banking group against the then applicable benchmark of a ratio of core tier 1 (“CT1”) capital to risk-weighted assets. The test demonstrated a shortage of capital. As a result, the defendants, two wholly-owned subsidiaries of the group, issued contingent convertible securities, described as enhanced capital notes. The notes, which carried a relatively high rate of interest, were not redeemable until specified maturity dates between 2019 and 2032 unless they were converted into shares on the occurrence of a conversion trigger, being any time when the group’s CT1 ratio fell below 5%, or they were redeemed early by the group on the occurrence of a capital disqualification event. Under clause 19 of the notes’ terms and conditions, contained in the trust deed, a capital disqualification event was deemed to have occurred if the notes ceased to be taken into account for the purposes of any stress test applied by the regulatory authority in respect of the group’s “consolidated CT1 ratio”. In 2013 regulatory changes replaced CT1 capital with a more restrictive category, common equity tier 1 (“CET1”) capital. The regulatory authority announced that the notes would now need to have a trigger for conversion higher than 5.125% CET1 in order to count as core capital but, under the terms of the notes, conversion would only be triggered if the group’s CET1 ratio fell to 1%. In December 2014 the regulatory authority carried out a stress test which did not take into account the notes and, as a result, the group announced that a capital disqualification event had occurred and that it was entitled to redeem the notes. The claimant trustee, on behalf of the note holders, sought a declaration that a capital disqualification event had not occurred, contending that the December 2014 stress test was not relevant for the purposes of clause 19 because it had been conducted by reference to a CET1 ratio rather than a consolidated CT1 ratio and that, alternatively, the fact that the notes had not been taken into account in the December 2014 stress test was not enough to trigger a capital disqualification event, rather the notes had to have been disallowed in principle from being taken into account for the purposes of the tier 1 ratio. The judge rejected the trustee’s first argument but accepted the second argument and declared that a capital disqualification event had not occurred. On the defendants’ appeal, the Court of Appeal, in construing the trust deed, took into account statements in the exchange offer memorandum, a letter from the group’s chairman and documents issued by the regulatory authority at and before the time at which the notes had been issued, and it allowed the appeal, holding that a capital disqualification event had occurred and that, therefore, the defendants were entitled to redeem the notes.’

WLR daily, 16th June 2016

Source: www.iclr.co.uk

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Financial watchdogs need more bite to bring shadow banking to heel – The Guardian

Posted June 6th, 2016 in banking, financial regulation, news by sally

‘Bank of England boss Mark Carney should listen to those who fear regulators need to do more to stop continued bad practice in the financial sector.’

Full story

The Guardian, 5th June 2016

Source: www.guardian.co.uk

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Court of Appeal: SDLT not payable by company using Shari’a finance scheme – OUT-LAW.com

‘Project Blue Limited (PBL) was not liable for stamp duty land tax (SDLT) in respect of its acquisition of the former Chelsea Barracks by means of a Shari’a finance scheme, the Court of Appeal has ruled.’

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OUT-LAW.com, 31st May 2016

Source: www.out-law.com

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FCA warns banks on use of anti-money laundering rules to close accounts – The Guardian

Posted May 25th, 2016 in banking, charities, competition, EC law, fines, money laundering, news by sally

‘UK banks have been told by the City regulator they should not use anti-money laundering rules as an excuse to close accounts for charities, politicians and other clients just because they perceive them as risky.’

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The Guardian, 24th May 2016

Source: www.guardian.co.uk

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Holocaust survivor was not a tax cheat, judge rules – Daily Telegraph

Posted May 17th, 2016 in banking, news, tax evasion, wills by sally

‘A holocaust survivor, who overcame the horror of his entire family’s murder by the Nazis to make millions in Britain, has been posthumously cleared of tax evasion by a judge.’

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Daily Telegraph, 16th May 2016

Source: www.telegraph.co.uk

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Bank Mellat’s $4bn claim: CA rules out one element, but the rest to play for – UK Human Rights Blog

Posted May 12th, 2016 in appeals, banking, damages, human rights, news, terrorism by sally

‘Bank Mellat’s challenge to the Treasury’s direction under the Counter-Terrorism Act 2008 has been before the courts on a number of occasions. In 2009, the Treasury had concluded that the Bank had connections with Iran’s nuclear and ballistic missile programme. In 2013, the Supreme Court quashed the direction, which had stopped any institution in London from dealing with the Bank.’

Full story

UK Human Rights Blog, 11th May 2016

Source: www.ukhumanrightsblog.com

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New Acts – legislation.gov.uk

Posted May 6th, 2016 in banking, financial regulation, legislation, trade unions by tracey

Trade Union Act 2016

Bank of England and Financial Services Act 2016

Source: www.legislation.gov.uk

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Don’t Overlook Overeaching – Tanfield Chambers

Posted April 26th, 2016 in banking, constructive trusts, conveyancing, interest, mortgages, news by sally

‘The case of AIB Group (UK) plc v Turner [2015] EWHC 2994 (Ch), heard over a number of days in the Birmingham District Registry towards the end of 2015, is something of a puzzle.’

Full story

Tanfield Chambers, 22nd April 2016

Source: www.tanfieldchambers.co.uk

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Saving the bank’s security after it is too late… – Tanfield Chambers

Posted April 26th, 2016 in banking, forfeiture, landlord & tenant, leases, news, setting aside by sally

‘It is a requirement of the court rules that when a landlord seeks to forfeit a residential lease by issuing a claim in court, that claim must be served on a mortgagee. The purpose of this provision is to make sure that the bank is able to apply for relief from forfeiture (and hence reinstate its security) before it is too late. But what happens if the bank is served with the claim, the tenant and the bank do not attend the hearing, the lease is forfeited and the possession order subsequently enforced with the result that title is closed and the bank loses its security?’

Full story

Tanfield Chambers, 21st April 2016

Source: www.tanfieldchambers.co.uk

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Can lenders avoid cost budgeting? – Tanfield Chambers

Posted April 26th, 2016 in banking, costs, landlord & tenant, news by sally

‘Is it possible for lenders to avoid the courts’ enthusiasm for managing costs of litigation?’

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Tanfield Chambers, 20th April 2016

Source: www.tanfieldchambers.co.uk

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Supreme Court: ‘land bank’ was unauthorised collective investment scheme – OUT-LAW.com

Posted April 25th, 2016 in appeals, banking, financial services ombudsman, news, Supreme Court by sally

‘A ‘land bank’ arrangement which sold small plots of land to investors at “hugely inflated prices” was an unauthorised collective investment scheme (CIS) which ought to have been regulated by the Financial Conduct Authority (FCA), the UK’s highest court has confirmed.’

Full story

OUT-LAW.com, 25th April 2016

Source: www.out-law.com

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Opportunity doesn’t knock twice: recovering damages for consequential loss – Hardwicke Chambers

‘Today’s banks are in receipt of the largest fines ever imposed by the Financial Conduct Authority (FCA), or its predecessor the Financial Services Authority (FSA), and although they are taking responsibility for a number of failings (eg PPI, Derivatives, LIBOR and FOREX), restrictions on recovering loss, in particular where consequential loss is concerned, have come under significant scrutiny. This article examines the measure of loss in tort and contract, and particularly explores investors’ difficulties when making claims for loss of profit caused by mis selling.’

Full story

Hardwicke Chambers, 31st March 2016

Source: www.hardwicke.co.uk

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Libor trial: former Barclays bankers were ‘driven by money’ – The Guardian

Posted April 7th, 2016 in banking, conspiracy, fraud, interest, news by sally

‘Five former Barclays bankers accused of conspiring to rig Libor interest rates were “driven by money” and their offence “is no different from stealing,” a court has been told.’

Full story

The Guardian, 5th April 2016

Source: www.guardian.co.uk

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Five new laws coming in today and how they will affect you – The Independent

Posted April 7th, 2016 in banking, capital gains tax, dogs, interest, news, pensions, visas by sally

‘Following the introduction of the National Living Wage and unwelcome increases to council tax, today sees another wave of new laws come into force in the UK.’

Full story

The Independent, 6th April 2016

Source: www.independent.co.uk

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Why you might not be warned of an online security breach – The Guardian

Posted March 30th, 2016 in banking, consumer protection, data protection, internet, news, notification by sally

‘Surprisingly, under the Data Protection Act companies have no obligation to tell customers there could be a problem.’

Full story

The Guardian, 30th March 2016

Source: www.guardian.co.uk

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Sir Bernard Hogan-Howe online fraud refund claim provokes anger – BBC News

Posted March 24th, 2016 in banking, consumer protection, fraud, internet, news, police, victims by tracey

‘A police chief’s suggestion that banks should consider no longer refunding some online fraud victims has been branded as “astonishingly misjudged” by a consumer group.’

Full story

BBC News, 24th March 2016

Source: www.bbc.co.uk

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Jailed Libor trader Tom Hayes must pay more than £878,000 – The Guardian

Posted March 24th, 2016 in banking, confiscation, fraud, interest, legal aid, news, proceeds of crime by tracey

‘Tom Hayes, the former star trader serving an 11-year jail sentence for manipulating Libor interest rates, has been ordered to pay £878,806 after a court ruled the money was the proceeds of crime.’

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The Guardian, 23rd March 2016

Source: www.guardian.co.uk

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Four guilty of hijacking migrant workers’ bank accounts – The Guardian

‘Three men and a woman convicted of laundering criminally acquired money in Cambridgeshire after trial over offences relating to exploitation of workers.’

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The Guardian, 22nd March 2016

Source: www.guardian.co.uk

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Holmcroft: Skilled person not amenable to judicial review – Henderson Chambers

Posted March 22nd, 2016 in banking, financial regulation, fraud, judicial review, negligence, news by sally

‘On 24 February 2016, in R (Holmcroft Properties Limited) -v- KPMG LLP and others, the Divisional Court dismissed Holmcroft’s judicial review challenge to the skilled person’s role in a mis-selling redress scheme. The skilled person, KPMG, had approved Barclays’ rejection of Holmcroft’s claims for consequential losses it claimed to have suffered as a result of the mis-sale. The court found that the skilled person was not amenable to judicial review and that, in any event, it had acted fairly.’

Full story

Henderson Chambers, 3rd March 2016

Source: www.hendersonchambers.co.uk

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Speech by the Lord Chief Justice: The Bailii Lecture 2016 – Courts and Tribunals Judiciary

Posted March 21st, 2016 in arbitration, banking, Commercial Court, courts, judges, rule of law, speeches by tracey

‘As is well known, the development of the law in England and Wales was effected not only through cases where the claims were brought in the courts, but through claims that were brought in arbitrations. In 1979 (by statute) and 1981 (by Lords Denning and Diplock through an interpretation of that statute), the relationship between the courts and arbitration was changed on the perceived basis that it was damaging the attractiveness of London as a centre for dispute resolution through arbitration.’

Full speech

Courts and Tribunals Judiciary, 18th March 2016

Source: www.judiciary.gov.uk

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