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The CEA (European Insurance and Reinsurance Federation) welcomes the opportunity to comment on the Financial Stability Board’s (FSB) initiative, which aims to develop an international framework to facilitate the orderly resolution of institutions, deemed ‘too big to fail’.
The CEA underlines the issue that the scope of application of these policy recommendations should clearly distinguish between different sectors of the financial industry, and in particular between the banking and insurance sectors.
The CEA also urged the FSB to note that the Solvency II framework sets up a clear distinction between home and host country responsibilities, while the current FSB consultation paper proposes that the resolution authorities will have power over foreign branches. It warns that this may create confusion and does not fit in the EU current legislation.