Shearman & Sterling LLP | FinReg | Eurozone Resolution Board Publishes Approach to Public Interest Assessment
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  • Eurozone Resolution Board Publishes Approach to Public Interest Assessment

    The Single Resolution Board has published a paper setting out its approach to the Public Interest Assessment under the resolution framework for Eurozone banks. The SRB is the resolution authority for all banking groups and entities as well as cross-border groups that are subject to direct prudential supervision by the European Central Bank (i.e., for banks within the Eurozone Banking Union). Under the resolution framework, an assessment is undertaken as to whether it would be in the public interest for a failing bank or a bank that is likely to fail to be resolved. The assessment is based on the objectives of maintaining financial stability, protecting covered depositors and safeguarding public funds. Where resolution is not appropriate, a bank would instead be subject to national insolvency procedures.

    The SRB's paper outlines the factors that it would take into account when carrying out the public interest assessment and how it applies the legal criteria. The paper also includes examples of how the SRB has conducted the assessment in practice by reference to recent resolutions involving banks such as Banco Popular Español S.A., Banca Popolare di Vicenza S.p.A, Veneto Banca S.p.A. and ABLV Group.

    View the SRB paper.

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