Frequently Asked Questions - Lender of Last Resort

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Who will be the lender of last resort to Scottish financial institutions?

In the Sterling Area, lender of last resort arrangements for financial institutions will continue to operate on a common basis across Scotland and the rest of the UK. This will reflect the reality of our integrated financial system. The Bank of England, as the institution responsible for financial stability, will continue to play its role in the effective functioning of the banking system using its operations under the Sterling Monetary Framework.

Banks receive lender of last resort facilities from across the world, and it is normal for countries to act in a coordinated way to secure financial stability. For example, the RBS and Barclays received significant liquidity support from the US Federal Reserve at the height of the financial crisis.

Source: Scotland's Future, Scottish Government, November 2013.