single resolution mechanism

ECB Offers Opinion on Proposed Regulation to Establish a European Deposit Insurance Scheme

On April 20, 2016, the European Central Bank (ECB) published an opinion on a proposal for a regulation amending Regulation (EU) No. 8.6/2014 in order to establish a European Deposit Insurance Scheme (EDIS).

The ECB notes that an EDIS is a necessary third pillar to complete the Banking Union, having established a Single Supervisory Mechanism and the Single Resolution Mechanism and overall welcomes the system proposed. However, the opinion notes risks in terms of scope and governance of the scheme.

The opinion appends a technical working document containing drafting proposals as proposed amendments to the text released by the European Commission.

European Commission Proposes SRM for Banking Union

On July 10, the European Commission published a press release confirming its proposal for a single resolution mechanism (SRM) for the banking union.

While the provisional text for the proposal is available, the EC’s website confirms that “the final text will be available soon.”  The SRM will complement the single supervisory mechanism previously proposed by the EC in September 2012, and it is envisioned that it will centralize certain competences and resources for managing the failure of any bank within the European Area and in any Member State participating in the Bank Union.

The Council of the EU aims to reach an agreement on the SRM by the end of 2013 so that the proposal can be adopted by May 2014 (the end of the current parliamentary term).  EC Press Release.