EC Consults on Crisis Management and Deposit Insurance Frameworks
EC published a public consultation on the review of crisis management and deposit insurance frameworks in EU. The public consultation addresses three EU legislative texts: Bank Recovery and Resolution Directive (BRRD), Single Resolution Mechanism Regulation (SRMR), and Deposit Guarantee Schemes Directive (DGSD). The possible revision of the resolution framework as well as a possible further harmonization of insolvency law are foreseen in the respective review clauses of the three legislative texts. By reviewing the framework, EC aims to increase its efficiency, proportionality, and overall coherence to manage bank crises in EU as well as to enhance the level of depositor protection, including through the creation of a common depositor protection mechanism in the banking union. The consultation is open until May 20, 2021.
This consultation covers 10 questions on the key directions of the review of the bank crisis management and deposit insurance frameworks. The questions raised in the consultation relate to the following aspects:
- Objectives of crisis management and deposit insurance frameworks
- Use of the tools and powers in BRRD
- Revision to the conditions to access different sources of funding in resolution and in insolvency
- Potential reform of the use of Deposit Guarantee Scheme funds in the future framework
- Issues related to depositor protection that would require clarification of the current rules and/or policy response
- Scope of depositor protection in the future framework
- European Deposit Insurance Scheme
Crisis management and deposit insurance, including a common funding scheme for the Banking Union, are strongly interlinked and interdependent and hold the potential for synergies, if developed jointly. In parallel to this consultation, EC is holding a targeted consultation, until April 20, 2021, which covers 41 questions that include the general questions and those addressing concrete technical features.
Related Links
Comment Due Date: May 20, 2021
Keywords: Europe, EU, Banking, BRRD, SRMR, DGSD, Deposit Insurance, Resolution Framework, Banking Union, Proportionality, Crisis Management Framework, EC
Related Articles
HKMA Finalizes Policy Modules on Group-Wide Approach and Remuneration
The Hong Kong Monetary Authority (HKMA) revised the Supervisory Policy Manual module CG-5 that sets out guidelines on a sound remuneration system for authorized institutions.
EBA Guide to Monitor Threshold for Intermediate Parent Undertakings
The European Banking Authority (EBA) published the final guidelines on the monitoring of the threshold and other procedural aspects on the establishment of intermediate parent undertakings in European Union (EU), as laid down in the Capital Requirements Directive (CRD).
PRA Finalizes Approach to Supervision of International Banks
In a recent Market Notice, the Bank of England (BoE) confirmed that green gilts will have equivalent eligibility to existing gilts in its market operations.
FCA Issues PS21/9 on Implementation of Investment Firms Regime
The Financial Conduct Authority (FCA) published the policy statement PS21/9 on implementation of the Investment Firms Prudential Regime.
EBA Proposes Regulatory Standards to Identify Shadow Banking Entities
The European Banking Authority (EBA) proposed regulatory technical standards that set out criteria for identifying shadow banking entities for the purpose of reporting large exposures.
IOSCO Proposes Recommendations on ESG Ratings and Data Providers
The Board of the International Organization of Securities Commissions (IOSCO) proposed a set of recommendations on the environmental, social, and governance (ESG) ratings and data providers.
ESMA Group Issues Recommendations on RFR Switch in Interdealer Market
The European Securities and Markets Authority (ESMA) published recommendations from the Working Group on Euro Risk-Free Rates (RFR) on the switch to risk-free rates in the interdealer market.
ECB Study Assesses Impact of Basel III Finalization Package
The European Central Bank (ECB) published a paper as well as an article in the July Macroprudential Bulletin, both of which offer insights on the assessment of the impact of Basel III finalization package on the euro area.
ISDA Finds FRTB Results in Higher Capital Charges for Carbon Trading
The International Swaps and Derivatives Association (ISDA) published a paper that explores the impact of the Fundamental Review of the Trading Book (FRTB) on the trading of carbon certificates.
PRA Updates Remuneration Policy Statement Templates and Tables
The Prudential Regulation Authority (PRA) published the remuneration policy self-assessment templates and tables on strengthening accountability.
