Single Resolution Mechanism

The establishment of a resolution framework within the EU is a consequence of the global financial crisis, which exposed regulatory and coordination shortcomings in dealing with troubled banks and financial institutions in the EU. In many cases such banks and institutions were bailed out with public money, in order to ensure the stability of the financial system, to protect deposits, and to prevent a further downturn in the real economy.

In response to this situation, a euro-area project called the Banking Union was initiated. The Single Resolution Mechanism is the second pillar of the Banking Union, the first pillar being the Single Supervisory Mechanism.

The Single Resolution Mechanism (SRM) comprises the Single Resolution Board and the national resolution authorities of euro area countries. In Slovakia, the national resolution authority is the Resolution Council. As for other EU Member States, they have the option to join the Banking Union on a voluntary basis.

The Single Resolution Board (SRB) became operational as an independent agency of the EU as of 1 January 2015. The SRB is composed of six full-time members, who assumed their positions in March 2015. The SRB cooperates closely with the national resolution authorities of euro area countries. At plenary sessions of the SRB, representatives of all institutions in the SRM are present. Slovakia’s Resolution Council will be represented at these meetings by Júlia Čillíková, Executive Member of the Council and NBS Executive Director – Financial Consumer Protection and Regulation Division.