The Single Resolution Fund (SRF), the financial arm of the eurozone Banking Union’s ‘resolution’ component, is expected to exceed €70 billion in 2024, the Single Resolution Board (SRB), the EU agency responsible for managing this financial instrument, said on Monday 5 July.
For 2021, the contribution of banks and some investment companies amounted to €10.4 billion, so that the current capacity of the SRF Fund is €52 billion.
The SRF’s endowment is equivalent to 1% of all bank deposits covered by EU law.
MREL. On Thursday 1 July, the SRB Chair, Elke König, gave MEPs an update on the progress made in 2020 by the banking sector in acquiring MREL, the capital required in a bank resolution in accordance with the obligations of the Bank Recovery and Resolution Directive (BRRD).
While the aggregate MREL capital deficit was €34.2 billion in 2019, it had narrowed to €19.5 billion by the end of 2020 despite the Covid-19 pandemic, she said.
“Our message to the banks is clear: the market is wide open and they need to continue issuing. They know the requirements and it is up to them to decide upon buffers to keep them safe”, she added, noting that progress had also been made in issuing subordinated debt. (Original version in French by Mathieu Bion)