Revised memorandum of understanding on UK Financial Stability

George Walker, Centre for Commercial Law Studies, London

The Financial Services Authority (FSA) has entered into a revised Memorandum of Understanding (MOU) for financial stability with HM Treasury and the Bank of England. The updated MOU was entered into on 22 March 2006 and replaces the earlier MOU signed in 1997. While the institutions consider that the earlier MOU had provided a solid and effective basis for co-operation, financial markets and institutional rules had evolved sufficiently during the following eight years that a revised MOU was considered appropriate. This includes specific new provisions concerning the management of financial crises and major operational disruptions following the work carried out in the City of London concerning financial capability and especially after 9/11/2001 and then 7/7/2006.