Decision-making body to be established on the basis of Article 114 TFEU at the beginning of 2015 that can order the resolution of failing institutions. Decision-making is transferred from the national to the European level by the framework for the recovery and resolution of credit institutions (bank recovery and resolution directive) and a related regulation establishing a single resolution mechanism. – A fund fed by deposits from institutions is to raise the resources for financing. In detail, the following applies: – In the course of European banking supervision, the ECB draws attention to the fact that a bank in the euro area is in serious financial difficulties and must be wound up. – A Single Resolution Board composed of representatives of the ECB, the European Commission and the relevant national authorities, the Resolution Board, prepares the resolution of the bank. This committee has broad powers with respect to determining the steps for the resolution of an institution. – The Commission decides whether and when to resolve a bank based on the recommendation of the Single Resolution Board or on its own initiative. The Commission also sets the framework for the use of resolution tools and the Fund. – The national resolution authorities, under the supervision of the Single Resolution Board, execute the resolution plans. The Single Resolution Board oversees the resolution process. It monitors implementation at the national level by the national resolution authorities and, in the event that a national resolution authority fails to comply with a decision, may issue implementation orders directly to failing banks. – A Single Resolution Fund (SRF) is created, subject to the control of the Single Resolution Board. This will ensure that medium-term funding is available in the event of a bank restructuring. The fund is financed by contributions from the banking sector. The details of this fund are governed by an intergovernmental agreement and not by European law. – The SRM met with criticism in Germany from a legal perspective. According to Art. 5, para. 1 TEU and Art. 7 TFEU, all competences not transferred to the Union in the treaties remain with the member states and thus with the parliaments as the rulers of the treaties. This is also required by the principle of democracy; and in any case as long as the European Parliament is not composed according to the principles of equal election. Currently, the weight of the vote of a voter from a large member state such as Germany is reduced by a factor of 11 compared to a voter from a small member state such as Malta. – The Single Bank Resolution Fund, which is to be used to feed insolvent institutions, also met with concern. This fund aims to redistribute risks between the banks of the member states and their shareholders and, above all, their depositors – i.e. savers. – See resolvability, investment liability, bailout, bank, systemic, bank bailout, bank bailout law, bank testament, banking union, bazooka, bridge institution, depositor liability, G-Sifi, creditor priority, moral hazard, emergency fund for crisis banks, rescue, bailout umbrella, shadow state, stability fund, European, too big to fail principle, transfer union, contract compliance, confidence bubble, zombie bank, forced convertible bond. – Cf. 2013 Annual Report of the Deutsche Bundesbank, pp. 36 ff. (detailed account; legal sources), Monthly Report of the Deutsche Bundesbank of June 2014, pp. 31 ff. (detailed account of the resolution mechanism; overviews (p. 51: sequence of decision-making processes in the SRM); important references to legal sources in the notes).

Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes without express consent!
University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
E-mail address: info@ekrah.com
https://de.wikipedia.org/wiki/Gerhard_Ernst_Merk
https://www.jung-stilling-gesellschaft.de/merk/
https://www.gerhardmerk.de/

Kommentare geschlossen.