Wed. Oct 27th, 2021

The Commission has today decided to send letters of formal notice to Finland and Greece on the grounds of incorrect transposition of the Bank Recovery and Resolution Directive (BRRD, 2014/59/EU).

This Directive is a centerpiece of the regulatory framework that was put in place to create a safer and sounder financial sector in the wake of the 2008 financial crisis It is a milestone for the EU’s Banking Union since the BRRD rules equip national authorities with the necessary tools and powers to mitigate and manage the distress or failure of banks in all EU Member States. The objective is to ensure that banks on the verge of insolvency can be restructured, without taxpayers having to pay for failing banks to safeguard financial stability. The deadline for the transposition of these rules into national law was 31 December 2014. These two Member States had notified a complete transposition of the Directive.

Following an in-depth assessment of the notified measures, the Commission has concluded that some provisions of the Directive are not correctly transposed into national law. The incorrect transposition concerns the provisions of the bank recovery and resolution framework related to the conditions for precautionary recapitalisation (Finland), and the exclusions to bail-in (Greece). Without a satisfactory response from these Member States within two months, the Commission may decide to address a reasoned opinion.