10 Amendments of Fabio Massimo CASTALDO related to 2023/0111(COD)
Amendment 62 #
Proposal for a regulation
Recital 2 a (new)
Recital 2 a (new)
(2a) The current legislative review seeks to reinforce the conditions for an orderly bank resolution that provides more protection for depositors. It firmly upholds the insurance to covered deposits, while ameliorating the policy toolbox for resolution, thus allowing for smoother alternatives that provide additional safeguards to depositors and financial stability.
Amendment 73 #
Proposal for a regulation
Recital 11
Recital 11
(11) Where the resolution strategy envisages the use of resolution tools other than bail-in, the recapitalisation needs of the entity concerned will generally be smaller after resolution than in case of open bank bail-in. The calibration of the MREL in such a case should take that aspect into account when estimating the recapitalisation requirement. Therefore, when adjusting the level of the MREL for resolution entities the resolution plan of which envisages the sale of business tool or the bridge institution tool and, optionally, its exit from the market, the Board should take into account the features of those tools, including the expected perimeter of the transfer to the private purchaser or to the bridge institution, the types of instruments to be transferred, the expected value and marketability of those instruments, and the design of the preferred resolution strategy, including the complementary use of the asset separation tool. Since the resolution authority has to decide on a case by case basis on any possible use in resolution of funds from the deposit guarantee scheme and since such decision cannot be assumed with certainty ex ante, the Board shouldmust not consider the potential contribution of the deposit guarantee scheme (in resolution when calibrating the level of the MREL. That approach also reduces the likelihood of moral hazard behaviours.
Amendment 77 #
Proposal for a regulation
Recital 17
Recital 17
(17) The resolution framework is meant to be applied to potentiallymanage the failure of any institution or entity, irrespective of its size and business mod that has a positive public interest assessment, namely, ifwhen the tools available under national law are not adequate to manage its failure. To ensure such outcome, the criteria to apply the public interest assessment to any failing institution or entity should be specified.
Amendment 85 #
Proposal for a regulation
Recital 18
Recital 18
(18) The assessment of whether the resolution of an institution or entity is in the public interest should reflect, among other factors, the consideration that depositors are better protected when deposit guarantee scheme funds are used more efficiently and the losses for those funds are minimisedfollowing a holistic evaluation. Therefore, in the public interest assessment, the resolution objective ofit should be considered that protectingon of depositors shcould be considered better achieved, depending on cases, in resolution if opting for insolvency would be more costly for the deposit guarantee scheme.
Amendment 89 #
Proposal for a regulation
Recital 19
Recital 19
(19) The assessment of whether the resolution of an institution or entity is in the public interest should also reflect, to the extent possible, the difference between, on the one hand, funding provided throughprioritisation of using industry-funded safety nets (resolution financing arrangements or deposit guarantee schemes) and, on the other hand,instead of funding provided by Member States from taxpayers’ money, except for extraordinary circumstances of a systemic nature or pertaining to very large economic turmoil. Funding provided by Member States bears a higher risk of moral hazard and a lower incentive for market discipline. Therefore, when assessing the objective of minimising reliance on extraordinary public financial support, the Board should find funding through the resolution financing arrangements or the deposit guarantee scheme, preferable to funding through an equal amount of resources from the budget of Member States.
Amendment 95 #
Proposal for a regulation
Recital 20
Recital 20
(20) To ensure that the resolution objectives are attained in the most effective way, the outcome of the public interest assessment should be negative only whereconsider whether the winding up of the failing institution or entity under normal insolvency proceedings would achieve the resolution objectives more effectively and not only to to the same extent as resolution.
Amendment 114 #
Proposal for a regulation
Recital 40 a (new)
Recital 40 a (new)
(40a) Given the creditor hierarchy review, market conditions might not be as favourable to deposit guarantee schemes that seek such alternative funding arrangements. Therefore, to prevent temporary financing by the Member States, and to ensure that it remains a last resort, the Board should be able to provide either a credit line or a guarantee based on the Single Resolution Fund to a deposit guarantee scheme in order to facilitate its access to markets at favourable financing conditions. The Single Resolution Fund's support should be provided when the deposit guarantee scheme is required to intervene in resolution, yet available financial means are insufficient to satisfy the needs of such action.
Amendment 123 #
Proposal for a regulation
Article 1 – paragraph 1 – point 1 – point c a (new)Regulation (EU) No 806/2014
Article 1 – paragraph 1 – point 1 – point c a (new)Regulation (EU) No 806/2014
Article 3 – paragraph 1 – point 55 a (new)
(ca) the following point is added: ‘(55a) ‘critical functions’ means activities, services or operations the discontinuance of which is likely, in one or more Member States, to lead to the disruption of services that are essential to the real economy or to disrupt financial stability at national or regional level on a significant scale, due to the size, market share, external and internal interconnectedness, complexity or cross-border activities of an institution or group, with particular regard to the substitutability of those activities, services or operations;’.
Amendment 226 #
Proposal for a regulation
Article 1 – paragraph 1 – point 19 – point c
Article 1 – paragraph 1 – point 19 – point c
Regulation (EU) No 806/2014
Article 18 – paragraph 5 – subparagraph 2
Article 18 – paragraph 5 – subparagraph 2
When carrying out the assessment referred to in the first subparagraph, the Board, based on the information available to it at the time of that assessment, shall consider and compare all extraordinary public financial support that can reasonably be expected to be granted to the entity, both in the event of resolution and in the event of winding up in accordance with the applicable national law.;
Amendment 309 #
Proposal for a regulation
Article 1 – paragraph 1 – point 41 a (new)
Article 1 – paragraph 1 – point 41 a (new)
Regulation (EU) No 806/2014
Article 79 a (new)
Article 79 a (new)
(41a) the following article is inserted: Article 79a Safeguarding the financial capacity of deposit guarantee schemes 1. Where the intervention of a deposit guarantee scheme is necessary in the context of a resolution but its available financial means are insufficient to achieve the purposes of its intervention, the deposit guarantee scheme may request support from the Board. 2. The request shall include all relevant information, including: (i) the shortfall of the deposit guarantee scheme for the purposes of the specific intervention in the resolution; (ii) the conditions offered to the deposit guarantee scheme in other alternative funding arrangements; (iii) the expected length of the requested support. 3. Upon receiving the request referred to in paragraph 1, the Board may decide to establish temporary liquidity support to the requesting deposit guarantee scheme, through the provision of a credit line or a guarantee by the Single Resolution Fund. 4. The Board in its executive session, after consulting with the Board in its plenary session, shall provide the support to the deposit guarantee scheme and the terms applicable to its provision. 5. The guarantee shall be used by the deposit guarantee scheme as collateral for alternative funding arrangements as referred to in Article 10(9) of Directive 2014/49/EU, thus ensuring access to markets in more favourable conditions.'