Bank Of England: Minutes Of The Wholesale Distribution Steering Group – 16 June 2021

Minutes

Item 1 – Standing agenda items

• 2 June 2021 minutes

The group agreed the 2 June 2021 minutes, and approved their publication

• Sharing information on stakeholder management

The Bank provided an update on the wholesale cash distribution review at a regular meeting that occurs between the Governor and the CEOs of the major UK banks this week. Sarah John attended and updated the group on the development work, timetable and key decision points. The Governor emphasised the importance of the work.

Item 2 – Progress Update

Project status

Eversheds reported good progress had been made with the development work, and noted that a clean team has been established to facilitate the appropriate sharing of sensitive information. The project remains on track against a nine week plan for developing a business case which will be delivered by end-July.

Clean team progress update

Eversheds confirmed that the clean team work has now begun and there has been positive and good engagement from members. The focus now is on gathering data to inform the asset selection process. Due to the commercially sensitive nature of the clean team work, updates will be provided to WDSG in a suitably aggregated form, as advised by Eversheds.

Asset selection criteria

KPMG provided an update on the asset selection criteria which highlighted changes made to reflect feedback from IEM members. This included a summary of which categories will be assessed such as geography, capacity and environmental impact and the weightings that will be applied to each. The agreed asset selection criteria are detailed in the annex.

The future cash demand assumptions were also presented which will be used to inform the work, this included a range of cash decline projections, taking into account the impact of the pandemic on cash use, and the increased uncertainty this has created. Members also agree the cash demand assumptions.

End of phase 3A decision

Eversheds provided an update on the phase 3A decision statement and how it enables firms to understand clearly what is expected at the end of the phase and what is required. Members will be asked formally to commit by October 29 to join and fund a Special Purpose Vehicle (SPV), which would transition to the Wholesale Cash Utility, subject to appropriate competition clearance.

Members formally agreed that the statement was an accurate reflection of what the work was attempting to achieve.

Item 3 – Review Action Log

Actions were reviewed and closed where applicable

Item 4 – AOB

None.

Committee attendees

Bank of England: Sarah John (Chair), Nick Butt, Elisabeth Bertalanffy-Fournier, Ronan McClintock, James Best, Molly Galligan
Eversheds: Ros Kellaway, Trystan Richards, Russell Saunders, Mark McLintock
KPMG: Simon Walker
Barclays: Tim Allen
HSBC: Sue Yarham
Lloyds Banking Group: Martin Barrett
Natwest: Colin Brindley
Santander UK: Robert White
HM Treasury: Azin Roussos
Virgin Money: Derek Walker
G4S: Paul Van Der Knapp
Vaultex: Phil Vaughan

Apologies

Richard Talbot (Natwest), Anne Jessopp (Royal Mint), Russell Hancock (Post Office), Kevin McMullan (Danske), Julie Fitzgibbon (BOI), John Garrett (AIB)

Annex – Asset Selection Criteria

These criteria are non-binding and are subject to change as the development work progresses.