News

On October 21^st the European Commission has adopted a delegated act and a draft proposal for a Council implementing act to calculate the contributions of banks to the national resolution funds and to the Single Resolution Fund respectively.

With the texts adopted today, the Commission fulfils the mandate it received from the European Parliament and the Member States to specify the methodology for the banks' contributions in order to meet the target levels for the resolution funds set by the Bank Recovery and Resolution Directive (BRRD) and by the Single Resolution Mechanism Regulation (SRM).

To ensure the availability of medium-term funding support so that a bank can continue operating while it is being restructured, resolution authorities will need liquidity. To that end, the BRRD sets up national resolution funds to which all banks have to contribute. The target level of these funds is of at least 1% of the amount of covered deposits of all the institutions authorised in its territory by 31.12.2024. In the Banking Union, the Single Resolution Fund will also have a target level of at least 1% of the amount of covered deposits of all the institutions authorised in the euro area.

The Board will apply the Commission Delegated Regulation and the Council implementing act, setting provisions specific to a common Fund established at European level.

As, under the SRM Regulation, the Commission is empowered to adopt a proposal for a Council Implementing Act only as of 1 November 2014, the Commission adopts today a draft proposal for a Council Implementing Regulation.

The Delegated act is subject to a right of objection by Council and Parliament within three months extendable by a further three months.

The Commission will formally adopt the proposal for an Implementing act of the Council after 1 November. The act will have to be discussed and adopted by the Council by the end of the year.