EC Consults on Crisis Management and Deposit Insurance Frameworks
EC published a public consultation on the review of crisis management and deposit insurance frameworks in EU. The public consultation addresses three EU legislative texts: Bank Recovery and Resolution Directive (BRRD), Single Resolution Mechanism Regulation (SRMR), and Deposit Guarantee Schemes Directive (DGSD). The possible revision of the resolution framework as well as a possible further harmonization of insolvency law are foreseen in the respective review clauses of the three legislative texts. By reviewing the framework, EC aims to increase its efficiency, proportionality, and overall coherence to manage bank crises in EU as well as to enhance the level of depositor protection, including through the creation of a common depositor protection mechanism in the banking union. The consultation is open until May 20, 2021.
This consultation covers 10 questions on the key directions of the review of the bank crisis management and deposit insurance frameworks. The questions raised in the consultation relate to the following aspects:
- Objectives of crisis management and deposit insurance frameworks
- Use of the tools and powers in BRRD
- Revision to the conditions to access different sources of funding in resolution and in insolvency
- Potential reform of the use of Deposit Guarantee Scheme funds in the future framework
- Issues related to depositor protection that would require clarification of the current rules and/or policy response
- Scope of depositor protection in the future framework
- European Deposit Insurance Scheme
Crisis management and deposit insurance, including a common funding scheme for the Banking Union, are strongly interlinked and interdependent and hold the potential for synergies, if developed jointly. In parallel to this consultation, EC is holding a targeted consultation, until April 20, 2021, which covers 41 questions that include the general questions and those addressing concrete technical features.
Related Links
Comment Due Date: May 20, 2021
Keywords: Europe, EU, Banking, BRRD, SRMR, DGSD, Deposit Insurance, Resolution Framework, Banking Union, Proportionality, Crisis Management Framework, EC
Related Articles
US Agencies Issue Several Regulatory and Reporting Updates
The Board of Governors of the Federal Reserve System (FED) adopted the final rule on Adjustable Interest Rate (LIBOR) Act.
ECB Issues Multiple Reports and Regulatory Updates for Banks
The European Central Bank (ECB) published an updated list of supervised entities, a report on the supervision of less significant institutions (LSIs), a statement on macro-prudential policy.
HKMA Keeps List of D-SIBs Unchanged, Makes Other Announcements
The Hong Kong Monetary Authority (HKMA) published a circular on the prudential treatment of crypto-asset exposures, an update on the status of transition to new interest rate benchmarks.
EU Issues FAQs on Taxonomy Regulation, Rules Under CRD, FICOD and SFDR
The European Commission (EC) adopted the standards addressing supervisory reporting of risk concentrations and intra-group transactions, benchmarking of internal approaches, and authorization of credit institutions.
CBIRC Revises Measures on Corporate Governance Supervision
The China Banking and Insurance Regulatory Commission (CBIRC) issued rules to manage the risk of off-balance sheet business of commercial banks and rules on corporate governance of financial institutions.
HKMA Publications Address Sustainability Issues in Financial Sector
The Hong Kong Monetary Authority (HKMA) made announcements to address sustainability issues in the financial sector.
EBA Updates Address Basel and NPL Requirements for Banks
The European Banking Authority (EBA) published regulatory standards on identification of a group of connected clients (GCC) as well as updated the lists of identified financial conglomerates.
ESMA Publishes 2022 ESEF XBRL Taxonomy and Conformance Suite
The General Board of the European Systemic Risk Board (ESRB), at its December meeting, issued an updated risk assessment via the quarterly risk dashboard and held discussions on key policy priorities to address the systemic risks in the European Union.
FCA Sets up ESG Committee, Imposes Penalties, and Issues Other Updates
The Financial Conduct Authority (FCA) is seeking comments, until December 21, 2022, on the draft guidance for firms to support existing mortgage borrowers.
FSB Reports Assess NBFI Sector and Progress on LIBOR Transition
The Financial Stability Board (FSB) published a report that assesses progress on the transition from the Interbank Offered Rates, or IBORs, to overnight risk-free rates as well as a report that assesses global trends in the non-bank financial intermediation (NBFI) sector.
