Following the financial crisis of 2007–08, UK legislation was passed to better protect customers and the day-to-day banking services they rely on.
The new rules mean large UK banks must separate personal banking services, such as current and savings accounts, from risks in other parts of the business, like investment banking. This is called "ring-fencing". Banks are taking different approaches to how they are implementing these rules and are making changes now, to complete them by 1 January 2019.
You can find out more about ring-fencing and bank structural reform legislation, on the Financial Conduct Authority's website www.fca.org.uk/consumers/ring-fencing, and the Bank of England's website www.bankofengland.co.uk
AA Savings Accounts are provided by Birmingham Midshires, part of Bank of Scotland, which is owned by Lloyds Banking Group. You can find out more about Lloyds Banking Group's approach to ring-fencing on the Group's website, www.lloydsbankinggroup.com/ringfencing. Please check those pages for regular updates.
What ring-fencing means for AA Savings Accounts customers
The majority of our personal banking services aren't affected and most customers won't see any changes. Your account details will stay the same. We'll write to any customers who are affected explaining what the changes mean for them.
Eligible deposits will continue to be protected by the Financial Services Compensation Scheme (FSCS). You can find more about the FSCS at www.fscs.org.uk
Some of the ring-fencing changes are made by a formal Court process
The Court process is called the Ring-Fencing Transfer Scheme (RFTS). Anyone who thinks the implementation of these changes may affect them negatively, has the right to participate in this Court process. You'll find full details of how to do this from mid December, on the Lloyds Banking Group website.
Timetable for the Court process:
25 September 2017: Interim hearing, for preliminary directions on some of the communications we need to make for the RFTS
4 December 2017: Directions hearing to seek the Court's approval for our application for the Court process to begin, including our overall plan for the communications we need to make for the RFTS
27 March 2018: Sanction hearing. At the sanction hearing the Court will consider and, if it sees fit, approve the RFTS.
These dates are subject to change, so please check our website regularly for updates
Be extra vigilant about fraud
Although the majority of our customers will see no changes, other banks will be making changes related to ring-fencing. During this period of change in UK banking you should be extra vigilant about fraud.
Don't assume that letters, phone calls, emails and text messages are genuine, even if the person knows information about you.
Don't feel pressured into making a decision or acting quickly. A genuine bank or organisation won't mind waiting if you want time to think.
If you receive instructions about a change in bank details from companies you make regular payments to, you should contact them on a number you normally use to check these are genuine.
At The AA we'll never call you and ask you to:
- Tell us your Telephone Password.
- Move money to a so-called safe or holding account.
- Move your money, or ask you to transfer funds to a different savings account that we provide.
If you have accounts with other banks
Other banks will tell you if your accounts with them are affected by the changes they're making. If you have any questions you should contact the relevant bank directly.