SRB Consults on Expectations from Banks to Demonstrate Resolvability
SRB launched a consultation that sets out the capabilities banks are expected to demonstrate to show that they are resolvable. The Expectations for Banks document outlines best practices on key aspects of resolvability. The Expectations are structured along seven dimensions: governance, loss absorption and recapitalization capacity, liquidity and funding in resolution, operational continuity and access to Financial Market Infrastructures, information systems and data requirements, communication, and separability and restructuring. In addition, the business model, structure, and complexity or other areas might have to be addressed to achieve resolvability of a bank. Comment period on the consultation ends on December 04, 2019.
The document sets out the SRB expectations for banks in the resolution planning phase, to demonstrate that they are resolvable and prepared for crisis management. It is a guidance on the actions that banks, under the SRB remit, should undertake to ensure an appropriate level of resolvability. The expectations represent a common approach to ensure consistency and a level playing field within the Banking Union. While the expectations are general in nature, their application to each bank will have to be tailored, taking into account proportionality principles based on a dialog between each bank and its Internal Resolution Team. The result will feed into the annual resolution work programs for banks.
The expectations are not exhaustive and do not prejudge the content of further SRB communications related to resolvability requirements for banks. In this context, Internal Resolution Teams may go beyond what is described in the Expectations by requesting additional information and analyses on specific topics in the resolution planning cycle that are relevant to progress in resolution planning and to improve the resolvability of the respective bank. Taking proportionality into account when applying the expectations, Internal Resolution Teams might also deviate from some of the expectations, provided this is considered appropriate and proportionate in light of the bank-specific characteristics. Banks are expected to work toward resolvability by applying the principles set out in this document as of the date of its publication.
Related Links
Comment Due Date: December 04, 2019
Keywords: Europe, EU, Banking, Resolution, Resolvability, Resolution Planning, Banking Union, Proportionality, Governance, SRB
Featured Experts
María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer
Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.
Patrycja Oleksza
Applies proficiency and knowledge to regulatory capital and reporting analysis and coordinates business and product strategies in the banking technology area
Previous Article
FSB Publishes Reports on Correspondent Banking and RemittancesRelated Articles
BIS and Central Banks Experiment with GenAI to Assess Climate Risks
A recent report from the Bank for International Settlements (BIS) Innovation Hub details Project Gaia, a collaboration between the BIS Innovation Hub Eurosystem Center and certain central banks in Europe
Nearly 25% G-SIBs Commit to Adopting TNFD Nature-Related Disclosures
Nature-related risks are increasing in severity and frequency, affecting businesses, capital providers, financial systems, and economies.
Singapore to Mandate Climate Disclosures from FY2025
Singapore recently took a significant step toward turning climate ambition into action, with the introduction of mandatory climate-related disclosures for listed and large non-listed companies
SEC Finalizes Climate-Related Disclosures Rule
The U.S. Securities and Exchange Commission (SEC) has finalized the long-awaited rule that mandates climate-related disclosures for domestic and foreign publicly listed companies in the U.S.
EBA Proposes Standards Related to Standardized Credit Risk Approach
The European Banking Authority (EBA) has been taking significant steps toward implementing the Basel III framework and strengthening the regulatory framework for credit institutions in the EU
US Regulators Release Stress Test Scenarios for Banks
The U.S. regulators recently released baseline and severely adverse scenarios, along with other details, for stress testing the banks in 2024. The relevant U.S. banking regulators are the Federal Reserve Bank (FED), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC).
Asian Governments Aim for Interoperability in AI Governance Frameworks
The regulatory landscape for artificial intelligence (AI), including the generative kind, is evolving rapidly, with governments and regulators aiming to address the challenges and opportunities presented by this transformative technology.
EBA Proposes Operational Risk Standards Under Final Basel III Package
The European Union (EU) has been working on the final elements of Basel III standards, with endorsement of the Banking Package and the publication of the European Banking Authority (EBA) roadmap on Basel III implementation in December 2023.
EFRAG Proposes XBRL Taxonomy and Standard for Listed SMEs Under ESRS
The European Financial Reporting Advisory Group (EFRAG), which plays a crucial role in shaping corporate reporting standards in European Union (EU), is seeking comments, until May 21, 2024, on the Exposure Draft ESRS for listed SMEs.
ECB to Expand Climate Change Work in 2024-2025
Banking regulators worldwide are increasingly focusing on addressing, monitoring, and supervising the institutions' exposure to climate and environmental risks.
