On 22 March 2021, the Single Resolution Board (SRB) issued a communication on its approach to liabilities governed by UK law without a contractual bail-in recognition clause as eligible for the minimum requirement for own funds and liabilities (MREL).

The SRB will consider liabilities governed by UK law without a contractual bail-in recognition clause as eligible for MREL, if they: (i) otherwise satisfy applicable MREL criteria; and (ii) were issued on or before 15 November 2018, when the SRB published its resolvability expectations for banks in the context of Brexit and noted the potential consequences of Brexit for banks’ existing stock of UK law governed MREL instruments. This exemption shall apply until 28 June 2025, to ensure alignment with the prudential grandfathering of the requirement to introduce contractual recognition clauses in own funds instruments provided for in Article 494b of the Capital Requirements Regulation