Changes from report parliamentary committee draft to plenary report

Added39. Highlights the role of the SRB and industry-funded safety nets in protecting taxpayers from paying for bailouts; believes that contributions to industry-funded safety nets must always be calculated in proportion to the risk that the institution represents; regrets that despite the political agreement in November 2020 on an early introduction, the backstop to the Single Resolution Fund (SRF), consisting of a credit line from the European Stability Mechanism (ESM), has not entered into application yet due to the delays in the ratification process of the Amending Agreement to the ESM Treaty; stresses the importance of the SRF for ensuring a robust and credible crisis management framework; calls for the full ratification of the Amending Agreement to the ESM Treaty by all Member States including the establishment of a common backstop to the SRF;

Added40. Recalls that banks need to continue to meet their obligations and perform their key functions after the implementation of a resolution decision; is concerned that banks might face liquidity stress in resolution immediately after regaining market access; calls for the EU institutions to agree on a solution that provides confidence and enhances predictability;

Deposit insurance

Change 15

Changed22.41. RegretsSupports calls by the lackEuropean ofParliament progressEDIS followingnegotiating team, together with the callscoordinators byand MEPsthe Chair of the ECON Committee in theirthe statement of 7 December 2022 for an ambitious review of the CMDI framework which may help to overcome hurdles to the establishment of EDIS and for negotiations on EDIS to be resumed; concurs with the ECB’s call for the resumption of work to establish EDIS;

Change 16

Removed23. Welcomes the Commission’s efforts to clarify the scope of depositor protection and increase convergence through a reform of 2014/49/EU on deposit guarantee schemes; warns that the CMDI review cannot be considered a replacement for EDIS;

Added42. Welcomes the legislative work at parliamentary level on the EDIS proposal that has taken place since the December 2022 statement of the Parliament’s EDIS negotiating team; reiterates Parliament's commitment to working towards an agreement on an EDIS; calls for the co-legislators to work towards the establishment of an EDIS that is realistic, credible, and solid;

Removed24. Underlines the need for risk-based contributions to EDIS; calls for institutional protection schemes to be taken into account; calls for an assessment of bank asset quality; recommends starting with the pooling of liquidity and a gradual build-up of funds;

Added43. Welcomes the Commission’s efforts to clarify the scope of depositor protection and enhance convergence through a reform of Directive 2014/49/EU on deposit guarantee schemes as part of the CMDI review; underlines that although the CMDI review cannot be considered a replacement for EDIS, a more harmonised framework may help to overcome hurdles to the establishment of EDIS; stresses the importance of the risk proportionality of contributions to deposit guarantee schemes;

Removed25. Notes that effective risk reduction is key for EDIS; highlights that the CMDI review provides co-legislators with an opportunity to resume negotiations on EDIS;

Added44. Underlines the need for a fully fledged EDIS with risk-based contributions that enables loss sharing; calls for a targeted assessment of bank asset quality; recommends starting by pooling liquidity and gradually building up an EU fund;

Added45 Calls for institutional protection schemes to be taken into account under any EDIS, in particular their risk-mitigating effect, while preserving the level playing field within the Single Market;

Added46 Recalls that one of the main objectives of the Banking Union is to break the link between bank and sovereign risks; notes that banks’ exposures to domestic sovereign debt remain high in the Banking Union; shares the EBA’s concern that sovereign exposures are material for EU banks and could become a source of potential vulnerability; emphasises that the issue of regulatory treatment of sovereign exposures must be consistent with international standards, and calls on the Commission to take this into account when addressing in any future proposals on this issue;

Added47. Welcomes the significant progress in risk reduction that has been made since 2015; notes, on the other hand, the limited progress on risk sharing; notes, however, that appropriate and effective risk reduction is necessary for the success of the Banking Union;

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48. Instructs its President to forward this resolution to the Council, the Commission, the European Central Bank, the Single Resolution Board and the European Banking Authority.