"Today's agreement by the Council marks an important moment for the Banking Union. It means we will now have a properly funded resolution Fund to sit behind our new resolution framework.
It's now over to the European Parliament to finalise its assessment of the contributions package so that the legal framework for bank resolution can enter into application in January 2015," said Jonathan Hill, EU Commissioner for Financial Stability, Financial Services and Capitals Market Union.
In April this year the European Union agreed new resolution rules for all EU banks (MEMO/14/294). This had to be followed by a delegated act and a proposal for a Council implementing act to calculate the contributions of banks respectively to the national resolution funds established by the Bank Recovery and Resolution Directive (BRRD) and to the Single Resolution Fund (SRF) (IP/13/674) established by the Single Resolution Mechanism Regulation (SRM) (MEMO/14/295).
On 21 October, the European Commission adopted these two texts (IP/14/1181).
Under the BRRD, the target level of the national resolution funds is set at national level and calculated on the basis of deposits covered by deposit guarantee schemes. Under the SRM, the target level of the Single Resolution Fund (SRF) is European and is the sum of the covered deposits of all institutions established in the participating Member States. This results in significant variations in the contributions by the banks under the SRM as compared to the BRRD. In order to smooth out differences, the Council Implementing Act provides for an adjustment mechanism to remedy these distortions during a transitional period by way of a gradual phasing in of the SRM methodology.