EBA proposes year-end deadline for large bank recovery plans
The EU has proposals for recovery plans under consideration
The European Banking Authority has adopted a formal recommendation to push major EU cross-border banks into developing group recovery plans by the end of this year. The plans have to be submitted to the relevant regulators.
It is intended to ensure that systematically important banks have plans in place ahead of the implementation of a comprehensive legislative framework for the recovery and resolution of credit institutions at EU level, which was proposed by the European Commission presented in June 2012.
The recommendation has a template that covers the key elements that a group recovery plans should feature, in accordance with the international standards agreed under the auspices of the Financial Stability Board These cover:
- general but comprehensive information on the institution and its governance structure;
- the list and description of options available in a crisis situation and an assessment of their execution and impact;
- the measures that the institution plans to implement to facilitate, in the future, the update of the recovery plan or its implementation in crisis times.
The proposed format has been put to those national competent authorities that are home supervisors for the 39 European banks affected by it. They have until 23 March to notify the EBA whether they comply or intend to comply with it.
