Brussels, 19/11/2013 (Agence Europe) - The committee on economic and monetary affairs of the EU has scheduled its vote on the single banking resolution mechanism for Thursday 5 December.
Of the 1,000 amendments tabled by the MEPs, a number of German Christian Democrat, Liberal and Social Democrat MEPs are calling for a drastic reduction in the scope of application of single resolution, in order to bring it into line with that of the single banking supervision mechanism, whereby just 128 banks will be directly supervised by the ECB from November 2014. On this point, they are following the position defended by Germany at the Council (see EUROPE 10965). Speaking in Strasbourg on Monday 19 November, Liberal Wolf Klinz justified this approach for “practical” reasons related to respect for the “principle of subsidiarity”. In the view of Social Democrat Peter Simon, banking supervision and resolution should work in parallel, which would allow many small banks to remain under national authority.
Pointing out that “resolution is not a day-to-day affair like supervision”, their Green compatriot, Sven Giegold, on the other hand, found this approach “bizarre”, particularly from a Liberal point of view. “The amendments from the CDU, FDP and SPD are going in the same direction to say local banks should not be covered by the single resolution mechanism. It is the same logic as for the single supervision mechanism. In Germany, smaller banks, not private ones (savings cooperatives), have their own system of resolution”, he explained. He added that, instead of calling for a simple exclusion as the banking associations concerned are doing, it would be better to “secure” the position of these establishments by means of a European mechanism, through their contribution to the single resolution fund at a far lower level than financial institutions which do not have these mechanisms.
Elisa Ferreira (S&D, Portugal), rapporteur on this dossier, said that the positions defended by the German MEPs were not majority positions within the committee. She listed the following points of agreement between the groups on a number of issues: - the supervisors should start a resolution procedure; - a credit line under the ESM should be available as a “backstop” for the single fund. On this point, representatives of the European Commission stated that the legal basis of the proposal (Article 114, single market) did not make it possible to create a safety net of this kind on the basis of the Community budget or of an international organisation (Ed: such as the ESM) and that a separate proposal would be necessary to set in place. (MB/transl.fl)