Introduction On 6 December 2012, the EU Council published a report entitled “Towards a Genuine Economic and Monetary Union”, building on an interim report on the same topic published in October 2012.  It proposes a timeframe and a 3-stage approach to the completion of Economic and Monetary Union (EMU), describing the RRP-specific requirements which form […]

Introduction On 5 December 2012, the European Central Bank (ECB) published its opinion on the EU’s draft directive establishing a framework for recovery and resolution of credit institutions and investment firms (the “Recovery and Resolution Directive” or “RRD”). In general, the ECB fully supports the RRD, welcomes the fact that it is in line with […]

Attached is a link to a guide to RRP written by Derivsource and yours truly.  There is also an accompanying podcast on the subject of RRP for financial market infrastructures.  I hope that you enjoy them – and feel free to share the links!

Here is a link to an FT article discussing the recent issuance by Barclays of CoCo bonds, the positioning of CoCo bonds within the capital structure and some of the risks associated with this type of instrument. Traditionally, CoCo bonds have converted to equity once a particular threshold is breached.  In contrast, the bonds recently […]

The RRD needs to focus less on the issue of individual failing banks and more on ways to resolve a general banking crisis, according to an EU Parliament press release published on 6 November 2012. In addition, the next priority should be to clearly define the point at which resolution is triggered and control of […]

Introduction On 8 October 2012, the EU Parliament’s Committee on Economic and Monetary Affairs (ECON) published a draft report proposing amendments to the European Commission’s draft regulation establishing a single supervisory mechanism (SSM). The most significant amendment proposed by the EU Parliament would restrict the number of banks coming under direct ECB supervision.  Whilst subject […]

Introduction On 17 October 2012, HM Treasury published a summary of responses received to its August 2012 consultation paper, entitled “Financial Section Resolution: Broadening the Regime” (the “Consultation Paper”).  Broadly, the Consultation Paper had proposed the widening of resolution regimes to systemically important non-banks, specifically: Investment firms and parent undertakings; Central counterparties (CCPs); Non-CCP financial […]

Introduction On 16 October 2012, the European Parliament’s Committee on Economic and Monetary Affairs (ECON) published a draft report (the “draft report”) on the EU Commission’s proposal for a Directive establishing a recovery and resolution framework for credit institutions and investment firms (the “RRD”).  The overriding concern of the authors of the draft report relates […]

Introduction On 5 October 2012, the European Commission published a consultation paper on a possible recovery and resolution framework for financial institutions other than banks.  The aim of the consultation is to ensure that all nonbank financial institutions the failure of which could threaten financial stability are capable of being resolved in an orderly manner […]