Transcript Eva H pkes
Bankruptcy and reorganisation procedures for cross-border banks in the EU Gillian Garcia, Rosa Lastra and Maria Nieto Comments by Eva Hüpkes London, 19 January 2009 Introduction • Very rich paper • Based on comprehensive research on the supervisory and bank resolution frameworks in the EU • Takes a holistic approach and proposes a broad reform agenda 19 January 2009 Comments on Garcia, Lastra, Nieto 2 The issue • Misalignment of the operation, supervision and resolution of internationally active financial institutions – International banks are global – Supervision is sectoral – Resolution is entity-centric and national 19 January 2009 Comments on Garcia, Lastra, Nieto 3 The challenges • The first step in any resolution is an asset grab • Focus on domestic objectives hinders coordinated solutions • Market-based resolutions are not always possible • Public assistance will be provided on a national level 19 January 2009 Comments on Garcia, Lastra, Nieto 4 Solutions for the EU? • Align the powers of the supervisory and resolution authorities for financial groups? • Place greater reliance on home authority/supervisory colleges? • Create a pan-European deposit insurance fund (EDIC) – a first step toward an EU supervisor? 19 January 2009 Comments on Garcia, Lastra, Nieto 5 Solutions internationally? • Safeguard critical functions (payments and settlement functions) • Strengthen national safeguards (e.g., more restricted branching, asset maintenance) • Work with key authorities toward prearranged firm-specific solutions 19 January 2009 Comments on Garcia, Lastra, Nieto 6