Single Resolution Mechanism

Key points:

The EESC

• welcomes the proposals to set up a Single Resolution Mechanism (SRM) and associated financing mechanism, which, forms an important new building block in developing the banking union;
• feels that work needs to be done on the various components (SSM, ESM, BRRD, SRM) of banking union, and that the logical sequence and internal consistency of the proposals needs to be respected when implementing them;
• calls for the BRRD and the SRM to be geared to one another as closely as possible;feels that with regard to the Single Resolution Board, it is vitally important for its members to have the greatest possible independence and expertise and for democratic scrutiny of its decisions to be built in. Its powers should be clear and well defined;
• feels that with regard to the Single Resolution Board, it is vitally important for its members to have the greatest possible independence and expertise and for democratic scrutiny of its decisions to be built in. Its powers should be clear and well defined;

• welcomes the proposed Single Bank Resolution Fund. The Committee would like the legal basis of the fund to be clarified as soon as possible and all the challenges involved in setting up such a fund (e.g. moral hazard) to be dealt with in advance;
• considers it important to ensure that the resolution fund has the financial resources it needs to fulfil its role properly. When setting the target level for the fund, fed by contributions from the banks, the various financial sector recovery measures in different areas should be taken into account.