Recovery and resolution of credit institutions

Key points:

The EESC welcomes the introduction of the effective resolution of failing financial institutions within the EU as an essential element in the completion of the internal market and forwards a number of recommendations:

  • additional clarity regarding those tools which are new and have not been tested in systemic crises;
  • banks should be involved in the process of the drawing up and the updating of resolution plans;
  • Professional advice of consumer organisations, trade union representatives, etc., should also be sought;
  • Central Banks should be involved in the assessment of the recovery and resolution plans;
  • confidentiality requirements with respect to credit institutions and their recovery and resolution plans should be strengthened;
  • harmonised rules and conditions for intra-group financial support are welcomed;
  • introducing explicit and more clearly defined trigger rules and conditions for the Special Manager;
  • the powers and responsibilities of RAs need additional distinctions and clarifications;
  • The directive should leave no doubt that supervisors have the right to inform the RA without waiting for notification by the bank's management whenever they deem that the trigger conditions for resolution have been met but the notification is delayed;
  • the bail-in tool needs additional explanations and clarifications;
  • the introduction as soon as possible of a realistic roadmap towards establishing the future system of financing arrangements for resolution funding.