EBF Chief Executive, Guido Ravoet, declared: “Where recovery tools fail to save a bank, resolution tools should ensure the continuity of economically relevant functions of a bank. For example, in order to limit the knock-on effect to the wider financial system and its customers, deposits and payments should not be interrupted.”
The cumulative impact of financial regulations on funding costs for banks and thus the ability to lend to the wider economy remains of concern to EBF Members. Nevertheless, the EBF accepts that the bail-in tool is the right solution to fund the resolution of systemically important banks. However, the EBF strongly urges policy-makers carefully to assess the need for additional resolution funds, and to explore the synergies with Deposit Guarantee Schemes in the light of the whole framework and other supervisory reforms, including the Deposit Guarantee Scheme Directive and the Capital Requirements Regulation.
With regard to the timing of the bail-in regime, the EBF agrees that the entry into effect should be appropriately timed when markets have returned to business as usual, while also allowing time for markets sufficiently to understand the new bail-in framework. The EBF is confident that this will be the case by 1 January, 2018.
Press release
© EBF
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