Featured Product

    SRB Chair Outlines Work Priorities for 2021

    January 11, 2021

    The SRB Chair Elke König published an article setting out work priorities for 2021. SRB will continue to focus on building the resolvability of all banks under its remit, as set out in the multi-annual program for 2021-23. In addition to building resolvability, SRB will continue to work with its European partners on completing the Banking Union, including finding an institutional solution for liquidity in resolution, making progress toward a common deposit guarantee system, and working on a European framework for bank insolvency. International cooperation is another cornerstone of the SRB work, with SRB recently having published a cooperation arrangement confirming its commitment to continue cooperation with BoE. Overall, SRB aims to play a role in ensuring a more resilient banking sector that can help build the recovery and financial stability in Europe and beyond.

    In dealing with the challenges posed by pandemic, the SRB approach has been to support banks with operational and financial relief measures, using flexibility in the resolution framework and by continuing to focus on ensuring banks resolvability. If a bank does fail, it means that this can be managed in an orderly way, without disrupting the economy or putting viable banks in danger. One reassuring news is that the banks provided all the required information, with only minor delays, and stayed on track to deliver in line with the SRB "Expectations for Banks" highlighted Ms. König. With a focus on building bank resolvability, the following are the four key priorities, or resolutions, for the year ahead:

    • Enhancing resolvability. SRB began the year by publishing its key policies, including the Expectations for Banks, as well as adapting these policies to the changes brought about by the new Banking Package. These policies provide banks with a clear guidance and a phased timeline for becoming fully resolvable. Banks are expected to have built up their capabilities on all aspects by the end of 2023, except where indicated otherwise. Where needed and on a bilateral basis, SRB may agree alternative phase-in dates with individual banks. The Expectations are tailored to each individual bank and its resolution strategy, allowing for flexibility and proportionality. SRB called on banks to do the work needed to achieve resolvability.
    • Ensuring ready-to-use resolution tools. Resolution plans are in place for all SRB banks, with the focus now on operationalizing these plans. Most SRB banks have resolution strategies that use bail-in alone or in combination with other tools. SRB will work on deepening banks’ bail-in playbooks, following the publication of a detailed operational guidance on this topic. SRB will also work to detail the plans for banks that use other resolution tools, such as transfer strategies.
    • Building up minimum requirement for own funds and eligible liabilities (MREL). Momentum on building up MREL needs to be maintained. Banks know their MREL targets and SRB urges them to establish realistic funding plans that do not put off until tomorrow what should be done today.
    • Growing the Single Resolution Fund. SRB will also continue to build up the Single Resolution Fund until 2023, when it is expected to be fully funded. SRB is on target for this goal. Late last year, the Eurogroup agreed to implement the backstop to the Single Resolution Fund stepwise in 2022, two years earlier than originally planned. This decision acknowledges that SRB has achieved risk-reduction in the Banking Union and it effectively doubles the amount of firepower of the fund.

     

    Related Link: Update from SRB Chair

     

    Keywords: Europe, EU, Banking, Resolution Planning, MREL, Banking Union, Work Priorities, Resolution Framework, SRF Backstop, Liquidity in Resolution, SRB

    Related Articles
    News

    EBA Clarifies Use of COVID-19-Impacted Data for IRB Credit Risk Models

    The European Banking Authority (EBA) published four draft principles to support supervisory efforts in assessing the representativeness of COVID-19-impacted data for banks using the internal ratings based (IRB) credit risk models.

    June 21, 2022 WebPage Regulatory News
    News

    EP Reaches Agreement on Corporate Sustainability Reporting Directive

    The European Council and the European Parliament (EP) reached a provisional political agreement on the Corporate Sustainability Reporting Directive (CSRD).

    June 21, 2022 WebPage Regulatory News
    News

    PRA Consults on Model Risk Management Principles for Banks

    The Prudential Regulation Authority (PRA) launched a consultation (CP6/22) that sets out proposal for a new Supervisory Statement on expectations for management of model risk by banks.

    June 21, 2022 WebPage Regulatory News
    News

    EC Regulation Amends Standards for Calculating Credit Risk Adjustments

    The European Commission (EC) published the Delegated Regulation 2022/954, which amends regulatory technical standards on specification of the calculation of specific and general credit risk adjustments.

    June 21, 2022 WebPage Regulatory News
    News

    HKMA Announces Launch of Data Repository on Sustainable Finance

    The Hong Kong Monetary Authority (HKMA) announced that the Green and Sustainable Finance (GSF) Cross-Agency Steering Group has launched the information and data repositories and outlined the progress made in advancing the development of green and sustainable finance in Hong Kong.

    June 21, 2022 WebPage Regulatory News
    News

    BIS Hub Updates Work Program for 2022, Announces New Projects

    The Bank for International Settlements (BIS) Innovation Hub updated its work program, announcing a set of projects across various centers.

    June 17, 2022 WebPage Regulatory News
    News

    EIOPA Issues Cyber Underwriting Proposal, Statement on Open Insurance

    The European Insurance and Occupational Pensions Authority (EIOPA) published two consultation papers—one on the supervisory statement on exclusions related to systemic events and the other on the supervisory statement on the management of non-affirmative cyber exposures.

    June 17, 2022 WebPage Regulatory News
    News

    NGFS Report on Integration of G-Cubed Model into NGFS Scenarios

    The Network for Greening the Financial System (NGFS) published a report that explores the feasibility of integrating the G-Cubed general equilibrium model into the NGFS suite of models.

    June 17, 2022 WebPage Regulatory News
    News

    US Senate Members Seek Details on SEC Proposed Climate Disclosure Rule

    Certain members of the U.S. Senate Committee on Banking, Housing, and Urban Affairs issued a letter to the Securities and Exchange Commission (SEC)

    June 16, 2022 WebPage Regulatory News
    News

    EIOPA Consults on Review of Securitization Framework in Solvency II

    The European Insurance and Occupational Pensions Authority (EIOPA) published a consultation paper on the advice on the review of the securitization prudential framework in Solvency II.

    June 16, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8301