S.L. 330.9 Art. 5Recovery plans. S.L. 371.15 Cap. 371.

(1) An institution, that is not part of a group subject to consolidated supervision pursuant to regulations 3 and 4 of the Supervisory Consolidation Regulations, shall draw up and maintain a recovery plan providing for measures to be taken by the institution to restore its financial position following a significant deterioration of its financial situation. Recovery plans shall be considered to be a governance arrangement within the meaning of article 17B of the Banking Act for credit institutions and the

Investment Services Rules for Investment Services Providers for investment firms.

(2) Institutions shall update their recovery plans at least annually or after a change to the legal or organisational structure of the institution, its business or its financial situation, which could have a material effect on, or necessitates a change to, the recovery plan. The Authority may require institutions to update their recovery plans more frequently.

(3) Recovery plans shall not assume any access to or receipt of extraordinary public financial support.

(4) Recovery plans shall include, where applicable, an analysis of how and when an institution may apply for the use of central bank facilities, subject to the conditions addressed by the plan, and identify those assets which would be expected to qualify as collateral.

(5) Without prejudice to regulation 4, the Authority shall ensure that the recovery plans include the information listed in Section A of the Schedule to these regulations, and any other additional information which may be required by the Authority on a case by case basis.

(6) Recovery plans shall also include possible measures which could be taken by the institution where the conditions for early intervention under regulation 27 are met.

(7) Recovery plans shall include appropriate conditions and procedures to ensure the timely implementation of recovery actions as well as a wide range of recovery options, and shall contemplate a range of scenarios of severe macroeconomic and financial stress relevant to the institution’s specific conditions, including system-wide events and stress, specific to individual legal persons and to groups.

(8) The Authority may require an institution to maintain detailed records of financial contracts to which the institution concerned is a party to.

(9) The board of directors of an institution shall assess and approve the recovery plan before submitting it to the Authority.