Featured Product

    EC Report Reviews Application of BRRD and SRMR in EU

    April 30, 2019

    EC adopted a report that reviews the application of Bank Recovery and Resolution Directive (BRRD) and Single Resolution Mechanism Regulation (SRMR) in EU. These legal acts are key elements of the legislation that was adopted in the wake of the financial crisis and constitute the core building blocks of the Banking Union. Given that the two legislative instruments have thus far have been applied in a limited number of cases, the report concludes that more time is needed for their assessment before any amendments are proposed.

    In its assessment, EC took stock of the implementation of the resolution legislation and its application to concrete banking cases. The legislation has been applied only in a very limited number of cases, out of which only one case concerned the resolution of an institution under SRMR. A number of these cases dealt with “legacy issues,” which accumulated during the financial crisis or before. Moreover, the provisions of the bail-in tool and the establishment of the Single Resolution Board became applicable only as of January 01, 2016. Additionally, other elements—such as resolution planning for larger and complex institutions and the provisions concerning MREL—require a phasing in to be fully implemented. Not to mention that certain crucial parts of the framework—including the provisions on Minimum Requirement for own funds and eligible Liabilities (MREL), moratorium powers, and the recognition of liabilities governed by third-country law—are still in the process of being amended and, once in place, transition periods will apply. After considering all these factors, the report concludes that more time is needed to fully assess the implications of the legislation. 

    EC will, however, continue to monitor the application of the resolution framework and further assess the identified issues. EC will also engage in a comprehensive discussion of the topics identified in this report with respect to BRRD and SRMR (as well as issues that may emerge from application of the resolution framework) with experts appointed by the European Parliament, member states, and all relevant stakeholders. This report has been prepared in accordance with the Article 129 of BRRD and Article 94 of SRMR, which require EC to review the application of the resolution framework and to submit a report to the European Parliament and the Council. The reports on the application of these legal instruments were due by June and December 2018, respectively. Due to the close links between these instruments, it was though to be appropriate to conduct a joint review for BRRD and SRMR. 

     

    Related Links

    Keywords: Europe, EU, Banking, BRRD, SRMR, MREL, Banking Union, Resolution Framework, SRB, EC

    Related Articles
    News

    BCBS Consults on Guidelines for Counterparty Credit Risk Management

    The Basel Committee on Banking Supervision (BCBS) is seeking comments, until August 28, 2024, on guidelines for counterparty credit risk management of banks.

    May 21, 2024 WebPage Regulatory News
    News

    ISSB Releases Digital Sustainability Disclosures Taxonomy

    The themes of the harmonization and interoperability of sustainability disclosure standards among various jurisdictions remain at the top-of-mind for international standard-setting bodies.

    May 21, 2024 WebPage Regulatory News
    News

    BCBS Report Studies Implications of Digitalization of Finance

    The Basel Committee on Banking Supervision (BCBS) published a report that examines the implications of the digitalization of finance for banks and supervisors.

    May 21, 2024 WebPage Regulatory News
    News

    HKMA Publishes Hong Kong Taxonomy for Sustainable Finance

    The Hong Kong Monetary Authority (HKMA) published the Hong Kong Taxonomy for Sustainable Finance.

    May 21, 2024 WebPage Regulatory News
    News

    EU Taking Steps to Set Out and Enforce AI Regulations

    Many believe that the transformative power of generative artificial intelligence (GenAI) has potential to reshape the financial sector in the time to come.

    May 21, 2024 WebPage Regulatory News
    News

    BIS Paper Outlines Vision for Future Financial System

    In a recent paper, the General Manager of Bank for International Settlements (BIS) and the Indian entrepreneur (Infosys co-founder) Nandan Nilekani have laid out a vision for the Finternet, which is proposed to be a network of multiple financial ecosystems, much like the internet.

    April 29, 2024 WebPage Regulatory News
    News

    NGFS Outlines Options for Supervisory Review of Transition Plans

    The Network for Greening the Financial System (NGFS) recently published three reports on the use of transition plans to boost sustainable finance and manage climate-related financial risks.

    April 29, 2024 WebPage Regulatory News
    News

    BCBS Issues Discussion Paper on Climate Scenario Analysis

    The Basel Committee on Banking Supervision (BCBS) issued a discussion paper on the use of climate scenario analysis to strengthen the management and supervision of climate-related financial risks.

    April 29, 2024 WebPage Regulatory News
    News

    OSFI Issues Phase2 Consultation on Climate Scenario Exercise for Banks

    The Office of the Superintendent of Financial Institutions (OSFI) recently announced a consultation on the second phase of the Standardized Climate Scenario Exercise (SCSE) for banks and other financial institutions it regulates in Canada.

    April 25, 2024 WebPage Regulatory News
    News

    CFIT to Chair Open Finance Taskforce Announced by UK Government

    The UK government announced the formation of an industry-led Open Finance Taskforce, chaired by the Center for Finance, Innovation, and Technology (CFIT).

    April 25, 2024 WebPage Regulatory News
    RESULTS 1 - 10 OF 8967