The Bank Recovery and Resolution Directive

13/11/2014

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Related topics: Banking and financeRDRRecovery and resolutionDepositor preferenceRing-fencingDeposit guarantee schemesFSCS and guarantee schemesCRD/CRRClient assetsShareholdersBanking UnionSecurities and derivatives

The Bank Recovery and Resolution Directive 2014/59/EU (BRRD),

originally known as the Recovery and Resolution Directive (RRD), is a minimum harmonisation directive which introduces an EU-wide framework of rules and powers for the recovery and resolution of credit institutions and certain investment firms.



The BRRD will give the relevant authorities wide powers including the ability to disrupt the rights of creditors and shareholders and to sell or transfer the business of an institution.



The BRRD was published in the Official Journal on 12 June 2014 and most of its provisions must be implemented by 1 January 2015. This excludes the bail in tool, which will need to be implemented by 1 January 2016. However some countries, such as the UK, have indicated that they will implement certain provisions of the bail-in tool by 1 January 2015.



We have published a report that looks at the BRRD in detail, including its provisions on resolution and recovery planning, the bail in provision and the rules governing intra-group financial support. To read the report click here.


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