Launch of the CEPS Task Force Report
The greatest novelty in the response to the financial crisis are specific financial resolution frameworks. Banks need to have detailed resolution plans readily available, and authorities have to fullest powers to apply early intervention policies in case minimum capital requirements are not met, with the possibility to wipe out shareholders and bail-in debtors. For banking union, this became a new authority with the Single Resolution Mechanism (SRM).
The operational consequences of the new regime are enormous. Not only do the EU member states need to create resolution authorities – or a Single Resolution Mechanism (SRM), which need to require banks to draft resolution plans and have a minimum level of bail-in-able debt, they also need be in a position to apply the new rules, most often over a weekend. But with the diversity in bank business models, in bank financing structures and instruments at EU and global level, this will be a formidable challenge, above all for internationally active banks. Authorities will need to ensure that the process will work in a harmonious and well-coordinated way across a multitude of jurisdictions.
Over the course of 2015 senior experts gathered in the CEPS Task Force on Financial Sector Resolution to discuss the unresolved issues related to the EU’s resolution mechanism. The interim report of the Task Force focusing exclusively on the pending issues related to banking sector resolution will be presented at the wake of the implementation of the Single Resolution Mechanism. The report will later this year be extended with chapters on non-bank resolution.
For the full agenda, please click here.
For the launch presentation, please click here.