the problem causing the group ’ s losses. the bail - in changes the ownership of the group but it does not affect the balance sheets of the subsidiaries. contrast lehmann. bis central bankers ’ speeches that doesn ’ t mean there is nothing to do. far from it. for example, firms ( legal entities ) issue bonds not only in their home county but in a host of other jurisdictions. we shall need the documentation of bond issues by banks and by their holding companies to make clear in terms that they may be bailed in or subjected to another type of resolution operation by the firm ’ s home authorities ; at the consequent change of ownership does not trigger “ default ” or ‘ control ” clauses. that should not be a high hurdle. it is equivalent to incorporating collective action clauses ( cacs ) in sovereign bond documentation. there is also a debate about which particular kinds of creditor claim should be subject to bail - in via resolution. indeed, this is one of the key questions in the commission ’ s consultation. one thought on this. it seems to me that the approach to putting losses on to different types of creditor should probably be the same whatever the resolution tool used and, indeed, the same as in a standard insolvent liquidation. that would suggest that one way of addressing proposals to “ exempt ” some types of claim from bail in, and to establish a hierarchy amongst other types of claim subject to bail - in, would be to alter the creditor hierarchy in insolvency law. while that could be useful in the longer run, i don ’ t think that is essential to make this resolution tool work. moreover, operating on the capital structure of a holding company can cut through some of the complexity, since topco debt is structurally subordinated to the debt and other obligations of the bank operating companies it owns. a final thought before moving on to a possible resolution strategy for a different type of sifi. what i have been describing is not a matter of designing new instruments with terms that automatically trigger a pre - determined write down or conversion into equity, which would essentially be a putative form of “ tier 3 ” capital. today ’ s topic is rather the toolkit the authorities need, in a statutory resolution regime, to maintain order when all such instruments have converted, all other options are exhausted and liquidation beckons. but whether via contractual terms or under resolution, debt can add to a bank ’ s loss absorbing capacity. the resolution of deposit - funded

management, not ordinary people with deposits in banks. and finally it means making sure that if you take out an insurance contract, it will pay out if whatever you are insuring against happens. the work that the bank does in all of these areas can ultimately be summed up very simply : we maintain confidence in money. this confidence is not, though an end in itself ; it is a means to an end. confidence in money provides the foundations for prosperity. without it, companies would struggle to provide the goods and services we all use every day ; you would face difficulties in knowing how to invest for your futures, be it financing studies or buying a house. maintaining this confidence is the best contribution the bank of england can make to the good of the people of the united kingdom. all speeches are available online at www. bankofengland. co. uk / speeches building public understanding of what the bank does – by engaging with people directly – is essential to our work. that ’ s because our policies work better if our objectives are clear and the british people have confidence that we will do the right thing whatever happens. improving understanding of the bank ’ s role is also part of being accountable to the people we serve. the bank is at the heart of the uk economy. the responsibilities parliament has given us are wide - ranging and the decisions we take affect everyone in the country. people deserve the information and tools to judge how well we are doing our job and to know that we are listening to your views. today ’ s event is also part of a wider effort by the bank to move beyond traditional modes of communication to speak more directly to the people we serve. while three hundred thousand people read the financial times, there are 30 million facebook users in the uk. and while everyone knows it is good to talk, the bank is learning how it can also be good to tweet – our twitter account has 227, 000 followers, though that still leaves us a little behind wayne rooney ’ s 16. 7 million. we are revamping our publications to make them more accessible, using icons and graphics to convey our messages on webpages designed for mobiles and tablets, rather than relying only on pages of words on paper. you can take a look at our first example of this – the november inflation report – online, at www. inflationreport. co. uk. this afternoon ’ s event will showcase a selection of the materials we are planning to run alongside these changes in our communications