The Bank of England (BoE) will force banks to publish plans illustrating how they would wind up operations if they were to go bust, announced BoE deputy governor Sir Jon Cunliffe, in the next step in regulators’ efforts to clamp down on “too big to fail” lenders.

The UK’s largest banks, such as Royal Bank of Scotland, Lloyds and Barclays, will have to submit a “self-assessment of their resolvability” to regulators, with the BoE planning on publishing certain “elements” of the plans.

In the announcement, the deputy governor said the plans were “the next step in the natural evolution of the resolution regime”, with the BoE launching a consultation on the plans at the end of this year on the framework that banks will need to follow.

The first round of bank self-assessments will begin in 2020, allowing lenders time to adjust to a new framework, Brexit and bank ring-fencing, Cunliffe said. Regulators globally want to ensure that there can be no repeat of the 2008 financial crisis, when the collapse of investment bank Lehman Brothers had a domino effect on the rest of the Western financial system.

Banks have been forced to dramatically increase the amount of capital they hold, and make structural changes to avoid the repeat of expensive government bailouts.

Cunliffe said: “The public needs to have confidence that we have learned lessons from the crisis: that we have acted to ensure that we have an alternative to the previous crisis where we had privatisation of bank profits in good times and the socialisation of bank losses when things go wrong.”

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