Shearman & Sterling LLP | FinReg | EU Single Resolution Board Publishes Guidance on Bank Operational Continuity and FMI Contingency Plans
Financial Regulatory Developments Focus
This links to the home page
Financial Regulatory Developments Focus
  • EU Single Resolution Board Publishes Guidance on Bank Operational Continuity and FMI Contingency Plans

    The EU Single Resolution Board has published new guidance for Eurozone banks for which it is the resolution authority on: (i) operational continuity in resolution for Eurozone banks; and (ii) financial market infrastructure contingency plans. The guidance applies to "significant" Eurozone banks that are directly prudentially supervised by the European Central Bank and certain other cross-border groups, for whom resolution is their strategy.

    The operational continuity guidance builds on one of the requirements of the SRB's Expectations for Banks, which demands that Eurozone banks have in place operational arrangements that enable them to continue to operate effectively while implementing resolution procedures. The guidance provides clarification on the arrangements that banks should make to preserve operational continuity, including the need to map the services, operational assets and staff required to preserve critical functions, conduct assessments of the risks to operational continuity in resolution and take action to mitigate risks to operational continuity.

    The FMI contingency plans guidance builds on the requirement under the SRB's Expectations for Banks that banks should have an FMI contingency plan outlining the measures they have implemented to support continued access to FMI services or a smooth transfer or wind-down of activities. The guidance sets out expectations on the minimum content of the FMI contingency plans as well as a series of other considerations that banks should take into account when drafting their plans.

    The SRB's Expectations for Banks will be phased in over three years, with banks expected to be fully compliant by 2023. The SRB's related guidance may be adapted to meet individual banks' needs and may be supplemented by future SRB communications. Although not produced in response to COVID-19, the implementation of the guidance will likely be informed by related experiences. 

    View the SRB's guidance for operational continuity in resolution and FMI contingency plans.

    Return to main website.