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Banking: Commission consults industry on reorganisation and winding up of credit institutions
Commission Européenne - IP/07/801 12/06/2007
Brussels, 12 June 2007
The European Commission has launched a public consultation on the Directive on reorganisation and winding up of credit institutions. The Commission is seeking to analyse whether the Directive (2001/24/EC) completely fulfils its objectives, whether it could be extended to cross-border banking groups, and how obstacles related to asset transferability within such groups can be addressed. Stakeholders are invited to give the Commission their views on the issues by 30 September 2007.
Internal Market and Services Commissioner Charlie McCreevy said: "This Directive provides us with a solid framework to deal with a credit institution that fails or is reorganised. But we now have to make sure that it meets the requirements and challenges of today's increasingly integrated European financial market. I encourage all interested stakeholders to give us their views on how the Directive could be improved."
The purpose of Directive 2001/24/EC is to ensure that a credit institution and its branches in other Member States are reorganised or wound up according to the principles of unity and universality. This means there should be only one set of insolvency proceedings, in which the credit institution should be treated as one entity. However, the Directive is limited in scope, in that it caters only for credit institutions with branches, and does not deal with possible issues which may arise as part of the reorganisation and winding-up of cross-border banking groups.
Stakeholders' opinions are sought on: (i) the problems of cross-border reorganisation and winding-up of banking groups, and the obstacles to the transferability of assets in a crisis situation; and (ii) on gaps and ambiguities in the current Directive identified so far.
The consultation takes place in the context of the current review of EU
supervisory arrangements which focuses on key challenges to the current
framework, in particular liquidity risk management, lender of last resort,
crisis management, deposit guarantee schemes and winding-up and reorganisation.
This work will contribute to the Commission's report to the European Parliament
and the Council on implementation of Directive 2006/48/EC (Capital Requirements
Directive) due by end 2011.