EC Approves Prolongation of Irish Credit Union Resolution Scheme
EC approved the prolongation of Irish credit union resolution scheme for orderly winding-up of credit unions to be in line with the EU state aid rules, particularly with the 2013 Banking Communication. The objective of the scheme is to safeguard financial stability when a credit union becomes unable to meet regulatory requirements. It allows Ireland to provide aid for transferring the assets and liabilities of a failing credit union to an acquirer through a competitive process. The scheme is being prolonged until May 31, 2020.
The move will help achieve maximum value for assets and liabilities, ensuring that the aid is limited to the minimum necessary for an orderly winding-up and that no buyer gains an undue economic advantage through the acquisition of under-priced assets and liabilities. Credit Unions are small financial institutions that are not covered by the Bank Recovery and Resolution Directive (BRRD). Ireland has chosen to make a special sector-funded resolution scheme available to the credit unions and the scheme has been used only three times since its setup. EC initially approved the scheme in December, 2011. It has been prolonged fourteen times since then, the last time in November 2018.
Post the financial crisis, EC had adopted a comprehensive framework to support the financial sector during the crisis and this framework spells out common conditions at the EU level for access to public support and the requirements for such aid to be compatible with the internal market in light of state aid principles. It comprises Banking Communication, the Recapitalization Communication, the Impaired Assets Communication, and the Restructuring Communication. These special rules were introduced under Article 107(3)(b) of the Treaty on the functioning of the EU that allows EC to approve state support to remedy a serious disturbance in the economy of a member state.
Related Links
Keywords: Europe, EU, Ireland, Banking, Financial Stability, Credit Unions, Resolutions, Orderly Resolution, EC
Previous Article
RBNZ to Introduce Deposit Protection and Accountability RegimesRelated Articles
MAS Concludes Blockchain Payments Prototype Shows Commercial Potential
MAS and Temasek jointly released a report to mark the successful conclusion of the fifth and final phase of Project Ubin, which focused on building a blockchain-based multi-currency payments network prototype.
EBA Publishes Phase 2 of Technical Package on Reporting Framework 2.10
EBA published phase 2 of the technical package on the reporting framework 2.10, providing the technical tools and specifications for implementation of EBA reporting requirements.
APRA Updates Reporting Validation Rules in July 2020
APRA updated the lists of the Direct to APRA (D2A) validation rules for authorized deposit-taking institutions, insurers, and superannuation entities.
PRA to Partly Apply EBA Guidelines on Disclosures for COVID Measures
PRA updated the statement that provides guidance to regulated firms on implementation of the EBA guidelines on reporting and disclosure of exposures subject to measures applied in response to the COVID-19 crisis.
EBA Updates List of Correlated Currencies Under CRR
EBA updated the 2019 list of closely correlated currencies that was originally published in December 2013.
FASB Proposes to Delay Implementation of Insurance Contracts Standard
FASB issued a proposed Accounting Standards Update that would grant insurance companies, adversely affected by the COVID-19 pandemic, an additional year to implement the Accounting Standards Update No. 2018-12 on targeted improvements to accounting for long-duration insurance contracts, or LDTI (Topic 944).
APRA Updates Regulatory Approach to Loan Deferrals Amid COVID Crisis
APRA updated the regulatory approach for loans subject to repayment deferrals amid the COVID-19 crisis.
BCBS and FSB Set Out Recommendations for Benchmark Transition
BCBS and FSB published a report on supervisory issues associated with benchmark transition.
IAIS Sets Out Recommendations for Benchmark Transition for Insurers
IAIS published a report on supervisory issues associated with benchmark transition from an insurance perspective.
ESMA Updates Reporting Manual on European Single Electronic Format
ESMA updated the reporting manual on the European Single Electronic Format (ESEF).
