Minutes of the Wholesale Distribution Steering Group – 14 July 2021

Minutes

Item 1 – Standing agenda items

14 July 2021 minutes:

The group agreed the 30 June 2021 minutes, and approved their publication

Sharing information on stakeholder management

Sarah John noted that she had spoken about Access to Cash at the Industry and Parliament Trust (IPT) that morning. Attending MPs expressed a keen interest in the progress of the wholesale work.

The Bank also noted that as part of their regular cross authority engagement they were in the process of engaging with the Competition Markets Authority (CMA) to provide them with an update on the Wholesale Work, as they had done in the past.

Item 2 – Progress Update

Project status

Eversheds reported that the last few weeks had been very productive as this phase of work enters the final stages, with clean team and commercial discussions now running in parallel.

An extra week has been added to close out some project deliverables, ensure members have the right information to inform their final decision, and allow for further discussions. The finalised business case and glidepath will now be shared with IEM members on 23 July and subsequently to WDSG.

Commercial discussions update

Eversheds summarised some of the key high-level issues that were being worked through as part of the commercial discussions, and where further information is required for the business case to help inform members’ decisions. This included the debt/equity funding requirements, ownership/governance structure, IT infrastructure and the transition path towards a utility model. Over the next week Eversheds will be running a programme of working groups and commercial sessions to develop these areas further.

Summary of Utility (SPV) business case

KPMG provided a progress update on some of the main outstanding issues from the previous phase of work, including the service catalogue/ provision of cash services and the cash ownership options. These issues are being developed further through a number of dedicated commercial discussions which are now underway.

High level overview of transition process

KPMG discussed the proposed transition plan for standing up the Utility. This included a possible path for how the operations of the four existing operators could be brought together over time, with the final utility, covering all in scope operations by 2024. They noted that a lot of this timeline was dependent on obtaining CMA clearance and that there would be restrictions on any work taking place prior to this clearance being obtained.

Signposting to the end of phase 3a

Eversheds provided an update on the remaining detail work plan in order to finalise phase 3a, including the expected objectives and deliverables from each meeting that will take place.

Item 3 – Review Action Log

Actions were reviewed and closed where applicable.

Item 4 – AOB

None.

Committee attendees

Bank of England: Sarah John (Chair), Elisabeth Bertalanffy-Fournier, 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: Abigail White

Virgin Money: Derek Walker

G4S: Paul Van Der Knapp

TRM: Anne Jessopp

Vaultex: Phil Vaughan

Apologies

Nick Butt (BOE), Ronan McClintock (BOE), Paul Pugh (Eversheds), Richard Talbot (Natwest), Russell Hancock (Post Office), Azin Roussos (HMT), Kevin McMullan (Danske), Julie Fitzgibbon (BOI), John Garrett (AIB)