Euro Area Bank Resolution and Crisis Management Arrangements: An Assessment

Banking supervision in the euro area has improved significantly following the creation of the Single Supervisory Mechanism (SSM) and overall the resilience of large euro area banks has improved. Nonetheless, important vulnerabilities remain and banking supervision continues to face important challenges, mostly relating to resources, liquidity risk, credit risk, NPLs, and the fragmentation of national laws. Bank crisis preparedness and management have been substantially upgraded, but here too the regime remains fragmented.

The same bank crisis preparedness and management framework faces significant transitional and structural challenges with, for instance, the build-up of bail-in-able financing (known as MREL), which should be expedited, prioritizing large banks.

Further problems relate to the provision of emergency liquidity assistance (ELA) and the availability of other adequate financial resources, through the Single Resolution Fund (SRF). A clarified financial stability mandate for the ECB would help in this regard.

These are some of the main vulnerabilities identified by the IMF in their latest FSAP of the Euro Area, which will be discussed during the event.

The main Speaker will be Mr Atilla Arda, who leads technical assistance and assessment missions for the Monetary and Capital Markets (MCM) Department of the International Monetary Fund (IMF). Further comments will be provided by Dr Costanza Russo, who is a member of the expert panel on «Banking Union – Resolution of Banks» for the ECON Committee of the European Parliament since 2016.

The event will be chaired by Professor Rosa Lastra, Sir John Lubbock, Chair in Banking Law at the Centre for Commercial Law Studies.

The event also falls within the research areas of the Banking and Finance Institute.

Please note: this event is for staff and students at Queen Mary's and their guests.