Featured Product

    SRB Decides on No Compensation to Certain Banco Popular Stakeholders

    March 18, 2020

    SRB has decided that no compensation is due to shareholders and creditors affected by the resolution of Banco Popular Español, S.A. It concluded that they would not have been better off under normal insolvency proceedings. The decision is based on the post-resolution valuation by an independent valuer as well as on the analysis of comments received in the context of the "right to be heard" process. A summary of the SRB decision will also be published in the Official Journal of the European Union.

    Banco Popular was resolved on June 07, 2017, following the ECB assessment that it was failing or likely to fail. SRB decided that resolution was in the public interest to protect depositors and prevent instability in the financial system and the Spanish national resolution authority (FROB) implemented the decision at a national level. The bank was sold to Banco Santander, S.A.. The services provided by Banco Popular to its customers continued as normal after resolution. A main principle of the European resolution framework is that no creditor should receive worse treatment than if the resolved bank was wound up under normal insolvency proceedings on the resolution date. An independent valuer analyzed hypothetical insolvency scenarios in the Valuation 3 report. It found that they would not have been better off if the bank had gone into insolvency proceedings on the same date.

    On August 06, 2018, SRB published a preliminary decision that no compensation was required and opened a "right to be heard" process, allowing affected shareholders and creditors to express their views and provide reasoning on why they may not agree with the preliminary decision and its underlying reasoning. SRB reviewed 2,856 submissions from parties who registered and were verified to take part in the process. The independent valuer was also asked to provide its independent views on the comments related to the Valuation 3 report. As outlined in the decision, the comments included in these submissions covered a number of aspects, including the independence of the valuer and the content of the Valuation 3 report. Following this analysis, SRB adopted its final decision, which was addressed to FROB,  which is the national resolution authority that implemented the resolution decision. This final decision is the last step in the formal process following the resolution of Banco Popular. The SRB Chair, Elke König said, “I understand this will be disappointing for those who have lost out, however it proves that the resolution framework is effective and shielded the taxpayer from losses and financial instability.”

     

    Related Links

    Keywords: Europe, EU, Banking, Resolution Framework, Banco Popular, Right to be Heard, FROB, SRB Decision, BRRD, SRB

    Featured Experts
    Related Articles
    News

    BSP Tackles Aspects of Lending and Islamic, Open & Sustainable Finance

    The Central Bank of the Philippines (BSP) issued communications covering developments related to online lending platforms, open finance framework and roadmap, and on the expected regulations in the area sustainable finance.

    January 16, 2022 WebPage Regulatory News
    News

    US Agencies Issue Regulatory Updates, FDIC Launches Tech Sprint

    The Board of Governors of the Federal Reserve System (FED) published the final rule that amends Regulation I to reduce the quarterly reporting burden for member banks by automating the application process for adjusting their subscriptions to the Federal Reserve Bank capital stock, except in the context of mergers.

    January 13, 2022 WebPage Regulatory News
    News

    EBA Issues Guide on Bank Resolvability, Consults on Transferability

    The European Banking Authority (EBA) published its assessment of risks through the quarterly Risk Dashboard and the results of the Autumn edition of the Risk Assessment Questionnaire (RAQ).

    January 13, 2022 WebPage Regulatory News
    News

    MFSA Publishes CRD5 Updates and Supervisory Priorities for 2022

    The Malta Financial Services Authority (MFSA) updated the guidelines on supervisory reporting requirements under the reporting framework 3.0.

    January 13, 2022 WebPage Regulatory News
    News

    HKMA Extends Repayment for Trade Facilities, Consults on Crypto-Assets

    The Hong Kong Monetary Authority (HKMA) published a circular, along with the reporting form and instructions, for self-assessment, by authorized institutions, of compliance with the Code of Banking Practice 2021.

    January 12, 2022 WebPage Regulatory News
    News

    FCA Registers Securitization Repositories; PRA Issues 2022 Priorities

    The Financial Conduct Authority (FCA) decided to register European DataWarehouse Ltd and SecRep Limited as securitization repositories under the UK Securitization Regulation, with effect from January 17, 2022.

    January 12, 2022 WebPage Regulatory News
    News

    EC Regulation Sets Out Methods for Measuring K-Factors Under IFR

    The European Commission (EC) published the Delegated Regulation 2022/25, which supplements the Investment Firms Regulation (IFR or Regulation 2019/2033) with respect to the regulatory technical standards specifying the methods for measuring the K-factors referred to in Article 15 of the IFR.

    January 11, 2022 WebPage Regulatory News
    News

    BIS Studies How Platform Models Impact Financial Stability & Inclusion

    The Bank of International Settlements (BIS) published a paper that assesses the ways in which platform-based business models can affect financial inclusion, competition, financial stability and consumer protection.

    January 10, 2022 WebPage Regulatory News
    News

    CBE Issues Additional Measures to Ease Disruptions from Pandemic

    The Central Bank of Egypt (CBE) published a circular with instructions on emergency liquidity assistance to banks that are unable to meet their liquidity requirements.

    January 10, 2022 WebPage Regulatory News
    News

    ESAs Publish List of Financial Conglomerates for 2021

    The European Supervisory Authorities (ESAs) published the list of identified financial conglomerates for 2021.

    January 07, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 7868