2022 SRB WORK PROGRAMME - srb.europa.eu - Single Resolution Board
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SRB WORK
PROGRAMME
2022
srb.europa.eu
Photo credits: Cover: iStockphoto/olaser Print ISBN 978-92-9475-280-2 ISSN 2529-671X doi:10.2877/56596 FP-AB-21-001-EN-C PDF ISBN 978-92-9475-281-9 ISSN 2529-6728 doi:10.2877/33489 FP-AB-21-001-EN-N More information on the European Union is available on the Internet (http://europa.eu). Luxembourg: Publications Office of the European Union, 2021 © Single Resolution Board, 2021 Reproduction is authorised provided the source is acknowledged. Printed by the Publications Office in Luxembourg
SRB WORK
PROGRAMME
2022
srb.europa.eu
2 Single Resolution Board I Work Programme 2022
Contents
SRB Work Programme 2022
Foreword3
Abbreviations5
Executive summary 6
1. Introduction 9
1.1. Mission statement 10
1.2. General policy context of the SRB’s work 10
2. The Single Resolution Board’s priorities for 2022 12
2.1. Achieving resolvability of SRB banks and LSIs 13
2.2. Fostering a robust resolution framework 20
2.3. Preparing and carrying out effective crisis management 25
2.4. Operationalising the Single Resolution Fund 26
2.5. The SRB as an organisation 27
3. Annexes33
Annex 1: SRB organisational chart 34
Annex 2: Resource allocation by activity for 2022 35
Annex 3: F
inancial resources and indicative procurement plan for
2022 (EUR) 36
Annex 4: Key performance indicators covering the 2022 cycle 38Single Resolution Board I Work Programme 2022 3
Foreword
The 2022 SRB Work Programme carry out the necessary reforms with
comes at a time when economies a view to have even more efficient
are rebounding from the deep European solutions. We need a single
recession triggered by the COVID‑19 banking and capital market to face
pandemic. Economic forecasts are the challenges of the future.
now painting a rosier picture than
expected some months ago, and Our resolution planning cycle for
banks have been resilient. However, 2021 is well on track, and we have
this should not make us complacent, already set clear priorities for the
and it certainly does not distract us 2022 cycle. Underpinning these prior-
from our goal: to ensure banks are ities, the SRB has developed guidance
fully resolvable by the end of 2023. for banks and our internal resolu-
tion teams, providing clear and solid
Our 2022 Work Programme is part of ground for banks to achieve resolva-
the 3-year strategy spelled out in our bility in line with the SRB Expectations
2021-2023 Multi-annual Programme. for Banks. Going forward, the focus is
The latter, together with the SRB on implementation and operationali-
Expectations for Banks, maps the sation, in line with the priorities that
path towards full resolvability of the we set last year.
banks under our remit by the end of
2023. The scars that the pandemic-in- To achieve this, we have set specific
duced crisis may have left in banks’ priorities for each bank in 2022 in
balance sheets are not yet clear. bespoke priority letters sent at the end
This makes our work on resolvabil- of September, as well as common prior-
ity and crisis readiness all the more ities for all. The focus in 2022 will be on
important to minimise any impact liquidity and funding in resolution, sep-
of potential bank failure on financial arability and reorganisation plans, and
stability and the public purse. information systems and Management
Information System capabilities.
For the same reasons, we believe the During the annual planning cycle, we
completion of the banking union – expect banks to make progress based
with the European Deposit Insurance on our guidance. Our resolvability heat
Scheme as the missing cornerstone of map will help gauge their performance
the review of the Crisis Management in doing so and ensure continuity in
and Deposit Insurance framework – our assessment.
remains a key priority for improving
the crisis toolbox and overall compet- Loss-absorption capacity is and will
itiveness of the European Union. The stay a key component of resolvability.
resolution framework has proven Many banks under the SRB remit have
effective, yet the toolbox can be been able to raise capital and debt
improved to better deal with failures instruments and thus build up the
of medium-sized banks and create necessary Minimum Requirements
a level playing field. The pandemic for own funds and Eligible Liabilities
has shown that European and inter- (MREL) issuances at record low
national decision-making bodies are interest rates. We encourage all banks
able to react quickly when needed, so to continue to build up their MREL in
we should not lose momentum and this favourable market.4 Single Resolution Board I Work Programme 2022
The SRB will further work on the oper- relevant judgments by the General
ationalisation of the resolution tools. Court and ensuring the transparency
As announced, we will take a careful of the calculation process with regard
look at operational requirements for to the contributions.
bail-in in resolution groups (Single
Point of Entry) and also expand our Of course, we do not do all this alone.
guidance on transfer strategies. Working hand-in-hand with national
The latter is reflected in minimum resolution authorities – which proved
requirements for own funds and so resilient during the pandemic –
eligible liabilities targets and closely is at the heart of our achievements.
relates to our work on separability. Our effective cooperation with other
European and international authori-
Crisis preparation is key for suc- ties, as well as the banking industry,
cessful bank resolution. In 2022, we also remains critical. We can all be
will conduct dry-run exercises to proud of how these efforts helped
test, among others, decision-mak- maintain financial stability for
ing procedures and coordination European citizens.
with external stakeholders. We will
integrate our new ICT tools into these On a personal note, I would like
exercises and put into practice the to share my appreciation of and
work carried together with national gratitude to our SRB Board Members
resolution authorities to develop and staff. 2022 will be my last year
national handbooks. serving as SRB Chair. We have come
a long way together since the early
The year 2022 will be a landmark for days of the SRB. We have been able
the Single Resolution Fund, given to navigate for more than a year
that the Common Backstop is set to on a remote virtual basis and are
enter into force early next year. This now preparing for a flexible, hybrid
will double the funds at our disposal working environment. I am proud of
to tackle bank failures. However, this how efficiently we have been able to
may not suffice if a systemic crisis adapt under such challenging and
occurs, so we still need a solution for fast-changing circumstances. Let us
the provision of liquidity in resolution. all work together to ensure we can
We will continue raising the annual deliver our priorities for 2022 and
ex-ante contributions to the Fund make all banks resolvable.
from banks, taking into account theSingle Resolution Board I Work Programme 2022 5
Abbreviations
ATC Advisory Technical Committee MAP Multi-Annual Programme
BRP Business Reorganisation Plan MIS Management Information Systems
BRRD Bank Recovery and Resolution Directive M-MDA MREL-Minimum Distributable Amount
CCP Central Counterparty MPE Multiple Point-of-Entry
CDS Credit Default Swap MREL Minimum Requirement for own funds
CMDI Crisis Management and Deposit Insurance and Eligible Liabilities
CMG Crisis Management Group MS Member States
CMT Crisis Management Team NCWO No Creditor Worse Off
CoRes Resolution Committee NPL Non-Performing Loan
DGS Deposit Guarantee Scheme NRA National Resolution Authority
DMO Document Management Office OSD Operational Steps Documents
DORA Digital Operational Resilience Act OSI On-Site Inspections
EBA European Banking Authority PIA Public Interest Assessment
ECB European Central Bank RC Resolution College
EDIS European Deposit Insurance Scheme R4C Ready for Crisis
EfB Expectations for Banks RAP Resolvability Assessment Process
ESM European Stability Mechanism ReSG Resolution Steering Group
ESRB European Systemic Risk Board RPC Resolution Planning Cycle
FMI Financial Market Infrastructure RPM Resolution Planning Manual
FOLTF Failing or Likely to Fail RPO Resolution Planning Office
FORA Forward Looking Agenda RTS Regulatory Technical Standard
FSB Financial Stability Board RTT Resolution Tactical Team
G-SIB Global Systemically Important Bank SCC Standard Contractual Clauses
HR Human Resources SNE Seconded National Expert
IAAPN Inter-Agency Appeal Proceedings SPE Single Point-of-Entry
IADI International Association of Deposit Insurers SRB Single Resolution Board
ICF Internal Control Framework SRF Single Resolution Fund
ICT Information and Communication Technology SRM Single Resolution Mechanism
IGA Intergovernmental Agreement SRMR Single Resolution Mechanism Regulation
IMF International Monetary Fund SWD Solvent Wind-Down
IRT Internal Resolution Team TLAC Total Loss Absorbing Capacity
ITS Implementing Technical Standard TPLE Trilateral Principle Level Exercise
LSI Less Significant Institution XBRL eXtensible Business Reporting Language6 Single Resolution Board I Work Programme 2022
Executive summary
This document presents the 2022 resolvability assessment heat map
Annual Work Programme of the will allow tracking banks’ progress
SRB, setting out the agency’s objec- towards resolvability and also
tives and priorities, as year-2 of the benchmarking across banks, peer
Multi-Annual Programme (MAP)1 for groups and resolution strategies.
2021-2023. The SRB is committed Where the SRB, after consulting
to making banks resolvable by the the competent authorities, deter-
end of 2023. As part of this effort, mines that there are substantive
in 2022 the SRB will work with a impediments to the resolvability
view to enforcing and operationalis- of a bank, it will notify this deter-
ing the guiding principles laid down mination to the bank and make a
in the SRB Expectations for Banks2 recommendation on the appro-
(EfB) and the Minimum Requirement priate measures to address those
for own funds and Eligible Liabilities impediments. An anonymised
(MREL) policy3. In parallel, the SRB aggregated version of the heat
will continue evolving as an organ- map according to various dimen-
isation and work towards crisis sions is expected to be made
preparedness. The SRB priorities lie public closer to the end of the
in the following five strategic areas, phasing-in period of the EfB.
in line with the 2021-2023 MAP. ►► The operationalisation of reso-
lution plans, as part of the 2022
1) ACHIEVING RESOLVABILITY OF RPC. The Resolution Planning
SRB BANKS AND LSIS Manual (RPM) has been fine-tuned
In 2022, the SRB will implement the and serves as a guide for resolu-
following priorities to work towards tion-planning activities. It supports
banks’ resolvability by the end of the SRB guidance of banks in
2023: their implementation of the EfB,
ensuring coherence between
►► Continue the implementation the common and bank-specific
of the SRB EfB for 2022, among requirements, and consistency
others, through common and across banks.
bank-specific priorities, as part
►► The SRB will enhance the internal
of the Resolution Planning Cycle
framework on deep-dives and
(RPC). For 2022, the common pri-
on-site inspections (OSIs). It will
orities are: (i) liquidity and funding
update its deep-dive guidance
in resolution; (ii) separability and
and perform quality assurance
reorganisation plans; and (iii)
checks to ensure consistency. The
management information system
deep-dives are expected to be a
(MIS) capabilities. In addition,
significant step in improving the
the SRB has addressed banks
SRB’s expertise before launching
with bespoke priorities, to steer
fully-fledged OSIs. The deep
each bank’s progress towards
dives will provide guidance from
resolvability.
some material lessons learnt in
►► To foster a level playing field order to develop the SRB OSI
in the banking union, the SRB framework, which will cover the
1
https://www.srb.europa.eu/system/files/w/document/2020-11-30%20SRB%20Multi-Annual%20
Work%20Programme%202021-2023.pdf
2
https://www.srb.europa.eu/system/files/media/document/efb_main_doc_final_web_0_0.pdf
3
https://www.srb.europa.eu/system/files/media/document/mrel_policy_may_2021_final_web.pdfSingle Resolution Board I Work Programme 2022 7
whole spectrum of the resolvabil- Functions at regional level, the crit-
ity assessment process (RAP). icality of transactional accounts,
and the assessment of protection
The SRB will continue its close of covered depositors / Deposit
cooperation with the national reso- Guarantee Schemes (DGS) and, on
lution authorities (NRAs) in Internal the analytical side, by enhancing
Resolution Teams (IRTs) regarding network and contagion models.
significant institutions, and to ensure ►► Expand the policy work on
the implementation and consistent Financial Continuity by introduc-
application of the Less-Significant ing the operational guidance for
Institutions (LSI) Guidelines and the the assessment of the identifica-
relevant SRB policies and guidance. tion and mobilisation of collateral
The SRB will continue to provide for the RPC 2022.
empirical analysis and support to
►► Continue the development and
NRAs when performing tasks for the
increase the consistency of the
LSIs under their direct responsibility.
SRB MIS architecture, as well as the
deployment of data warehouse
2) FOSTERING A ROBUST
automated tables and dashboards
RESOLUTION FRAMEWORK
in resolution planning.
Over the past few years, the SRB has
established and published its core
To ensure the adequate reflection
policies, so the focus has now shifted
of the new policies in the resolution
to operationalising the existing
plans, the SRB will conduct a system-
guidance. The key areas for work in
atic quality review of all resolution
2022 are:
plans, to ensure up-to-date and har-
monised drafting practices for banks
►► Update and enhance the MREL
under the SRB’s direct remit.
policy by (i) reviewing the no-cred-
itor-worse-off (NCWO) approach;
In 2022, the SRB will continue to
(ii) implementing upcoming
provide informed inputs to the leg-
European Banking Authority (EBA)
islative and policy discussions of
regulatory technical standards
relevance to resolution and the
(RTS) timely into the SRB policy;
banking union. The SRB is actively
and (iii) reviewing the MREL cali-
engaged and stands ready to support
bration for transfer strategies.
legislators in the ongoing review of
►► Deepen the operationalisation the Crisis Management and Deposit
of the single point of entry (SPE): Insurance (CMDI) framework and
through work on (i) the identi- the European Deposit Insurance
fication of legal and practical Scheme (EDIS) discussions. At inter-
obstacles to the implementation national level, the SRB contributes
of bail-in, including issues identi- to the development of resolution-re-
fied during the April 2021 dry-run lated international standards at the
as well as other issues stemming Financial Stability Board (FSB), and to
from the national and European bilateral dialogues with non-EU juris-
legislative framework; (ii) reso- dictions on financial services.
lution powers in the execution
of SPE strategies; (iii) the use of 3) PREPARING AND CARRYING OUT
arrangements, including contrac- EFFECTIVE CRISIS MANAGEMENT
tual, safeguarding the availability With a view to enhancing crisis prepar-
of sufficient resources to support edness, in 2022 the SRB will conduct
subsidiaries, where necessary. dry-run exercise testing, among
►► Introduce additional policy others, decision-making procedures
enhancements for the Public and coordination with external stake-
Interest Assessment (PIA), i.e. holders. In particular, the SRB will
for the assessment of Critical conduct a technical dry-run exercise8 Single Resolution Board I Work Programme 2022
involving at least one resolution unit, parallel, the SRF will carry out the
one bank and one NRA, with aiming annual exercise of calculating and
at testing bail-in execution, among collecting ex-ante contributions. As
others, as well as some aspects of the SRF continues to increase (over
governance in crisis, with the involve- EUR 52 billion as at June 2021),
ment of senior management. The the SRB continues to improve the
latter, as part of the overall goal of management of these funds. The
operationalising the resolution tools, 2022 Investment Plan will be imple-
will put into practice the work carried mented by two external investment
out together with NRAs to develop managers, and the SRB will review its
national handbooks. Dry-run will also investment strategy.
provide an opportunity to integrate
the new SRB ICT platform, Ready for 5) THE SRB AS AN ORGANISATION
Crisis (R4C), and to align it with other The SRB is now a mature institution
existing data projects and platforms. that has successfully coped with the
Lessons learned will be incorporated operational challenges posed by the
into the SRB crisis management pro- COVID‑19 pandemic, proving the
cedures and templates, ensuring importance of sound business conti-
consistent approaches and best nuity planning. The SRB will continue
practices among IRTs. working towards a ‘digital SRB’, imple-
menting its 2022 ICT strategy and
4) OPERATIONALISING THE SRF development programme. The SRB
In early 2022, the Common Backstop will also work to strengthen talent
to the Single Resolution Fund (SRF) retention by developing dedicated
will enter into force. This requires the learning and career opportunities.
SRB to implement its collateral policy Lastly, in 2022 the SRB will implement
and the methodology for the assess- the post-pandemic ‘new normal’
ment of its repayment capacity. In hybrid working arrangements.Single Resolution Board I Work Programme 2022 9
1
Introduction4
4
This publication is not intended to create any legally binding effect and does not in any way substitute the legal requirements laid
down in the relevant applicable European Union and national laws. It may not be relied upon for any legal purposes, does not
establish any binding interpretation of EU or national laws and does not serve as, or substitute for, legal advice. This document may
be subject to further revisions, including due to changes in the applicable EU legislation. The SRB reserves the right to amend this
publication without notice whenever it deems appropriate, and it shall not be considered as predetermining the position that the
SRB may take in specific cases, where the circumstances of each case will also be considered.10 Single Resolution Board I Work Programme 2022
1.1. Mission statement
The SRB is the central resolu- within the SRB’s remit be failing or
tion authority within the banking likely to fail, and also fulfil the other
union. Together with the 21 NRAs criteria for resolution, the SRB will
of the participating Member States draft and adopt a resolution scheme
(MS), it forms the Single Resolution and the relevant NRAs will implement
Mechanism (SRM). Its mission is the resolution accordingly. In addition
to ensure an orderly resolution of to resolution planning and decisions
failing banks with minimum impact for significant institutions, the SRB
on the real economy, the financial also performs an oversight function
system and the public finances of the with regard to LSIs. The SRB is also
banking union’s MS and beyond. in charge of the industry-funded SRF,
which was established to provide
The role of the SRB is proactive: ancillary financing to ensure the
rather than waiting for resolution effective application of resolution
cases to manage, the SRB focuses on schemes.
resolution planning and enhancing
resolvability in close cooperation The SRB’s values: the SRB strives to
with NRAs. The SRB drafts and adopts be a trusted and respected resolution
resolution plans for the banks under authority with a strong resolution
its remit and regularly updates capacity in the SRM, thus avoiding
these plans. In this context, the SRB future bail-outs. The SRB aims to be
determines the preferred resolution a centre of expertise in bank resolu-
strategy for a bank. This strategy sets tion. Its three values are: (i) Excellence
out the resolution tools and powers in Resolution, (ii) Integrity and (iii) EU
to be applied in the event of resolu- spirit.
tion and sets the MREL. Should a bank
1.2. General policy
context of the SRB’s
work
Due to the COVID-19 pandemic, stability, and the extraordinary
2020 and 2021 tested the global and temporary – regulatory and fiscal
EU financial regulatory framework – relief measures adopted in 2020
developed after the Great Financial were necessary. However, the case
Crisis, which has proved to be fit for such flexibility is fading away as
for purpose overall. Following the the European economy recovers, so
financial turmoil of March 2020, these measures will be progressively
the monetary and fiscal response withdrawn.
to the crisis, the decisive reaction
by regulators, and the robustness The SRB is part of an evolving policy
of banks together kept a potential and regulatory context, and stands
severe economic recession at bay. ready to engage as a key stake-
The banking union has played a holder in broader EU financial policy
major role in safeguarding financial discussions.Single Resolution Board I Work Programme 2022 11
The year 2022 will undoubtedly As economies recover from the
include regulatory activity aimed at COVID‑19 pandemic, governments
addressing the remaining gaps in the will gradually withdraw the unprece-
European financial regulation. The dented public support granted over
European Commission is expected to the past few years. This will require
present a legislative proposal on the a careful and targeted approach.
review of the CMDI framework. The The impact on non-performing loans
review concerns three legislative texts (NPLs) for the moment is limited, yet
for handling bank failures, including the outlook remains uncertain and
the SRB’s founding regulation, which vulnerable. The Commission’s Action
directly affects the Board’s activities Plan on NPLs sets out ambitious
on the medium term. The priorities options for addressing any resur-
include enhancing the toolkit to deal gence, and the SRB remains a
with medium-sized banks, the pro- committed partner in policy discus-
gressive harmonisation of national sions on this front. Should NPL issues
insolvency procedures and the contribute to a bank failing and being
alignment of the 2013 Banking resolved, the resolution framework
Communication with the revised Bank provides for adequate tools and
Recovery and Resolution Directive funding to resolve problems arising
and Single Resolution Mechanism from NPLs.
Regulation (BRRD/SRMR) framework.
The third pillar of the banking union, The SRB is also closely monitoring
EDIS, is still pending, but needs to the digitalisation of financial services
remain the target for an efficient CMDI and the related policy initiatives,
framework. A political agreement on including the Digital Operational
a credible stepwise and time-bound Resilience Act (DORA) and its
calendar towards European deposit relevant provisions for banks. The
insurance is needed to avoid perpet- SRB stands ready to play its role,
uating the use of public funds in the given the importance of data and
national handling of banking crises. MIS for resolvability. Sustainability
and green financing are also key
The Common Backstop to the SRF developments that are here to stay,
will enter into force in early 2022. and the SRB welcomes the progress
After several years of political nego- made these topics. In addition, the
tiations and operationalisation of the SRB supports the work being made
backstop, its entry into force is an on the Capital Markets Union, and
important milestone for the SRB as encourages further efforts towards
an organisation and reinforces the its completion.
credibility of the banking union’s res-
olution framework. Nevertheless, the Finally, in parallel with the entry into
Common Backstop is not a panacea force of the EU regulatory framework
and may not suffice to tackle the for the recovery and resolution
failure of a major Global Systemically of central clearing counterparties
Important Bank (G-SIB) or a systemic (CCPs), the SRB will continue to ensure
crisis from a liquidity viewpoint. A its contribution to and coordination
structural solution for the provision with all other participants of the CCP
of large‑scale liquidity in resolution is Resolution Colleges.
still to be found.12 Single Resolution Board I Work Programme 2022
2
The Single Resolution
Board’s priorities for
2022Single Resolution Board I Work Programme 2022 13
The SRB’s work in 2022 pivots around few years provides clarity and solid
the SRB’s commitment to make banks grounds for banks to achieve resolv-
fully resolvable by the end of 2023. ability in the different dimensions
This is part of a multi-annual effort set laid down in the EfB. The SRB has
in the SRB Expectations for Banks and opted for a transparent and ongoing
MREL policy. The 2021‑2023 MAP set relation with banks, and clearly sets
the stage for this exercise with clear out what is expected from them in
goals. The multiple guidance that 2022 to reach the goal of resolvability
the SRB has developed over the past by the end of 2023.
2.1. Achieving
resolvability of SRB
banks and LSIs
In 2022, the SRB will implement the
priorities in the strategic area of
2.1.1.
resolvability of SRB banks and LSIs, Implementation
along the priority streams of the
2021-2023 MAP. They concern:
of the SRB
Expectations for SRB
(i) the implementation of the SRB
banks
EfB for 2022, among others,
through common and bank-spe-
On 1 April 2020, the SRB published
cific priorities, as part of the RPC;
its EfB, which is the key reference
(ii) further operationalisation of the document for banks to build their
resolution plans when updating capabilities, under the SRB guidance,
plans and MREL as part of the 2022 in order to demonstrate that they
RPC, supported by banks’ testing are resolvable by the end of 2023
exercises under SRB guidance to in each of the areas for the suc-
demonstrate resolvability; cessful execution of their resolution
(iii) the conduct of resolvability strategies.
assessments, feeding into a
newly created SRB heat map, and The EfB are subject to a gradual
decisive action where no suffi- phase-in. The figure below shows
cient progress is made; the periods over which banks are
(iv) the enhancement of the SRM expected to build up their capabilities
internal framework on deep- in respect of the specific dimensions
dives and OSIs; of the EfB, with the beginning of 2024
as the latest deadline.
(v) the strengthening of the oversight
function of LSI.14 Single Resolution Board I Work Programme 2022
Figure 1: EfB phase-in over 2020-2023
2020 2021 2022 2023
Governance Governance arrangements supporting resolution preparedness
Loss- Fulfil intermediate MREL Fulfil final MREL targets
MREL: targets by 1 January 2022
absorbing & by 1 January 2024
recapitalisation
capacity Operationalisation of bail-in (bail-in playbooks)
SRB Expectations for Banks
Liquidity and Ability to estimate Capabilities: (1) to measure, report and forecast
funding in liquidity and funding liquidity in resolution; and (2) to identify and monitor
resolution needs in resolution assets (collateral) to obtain funding in resolution
Operational Assessment of operational continuity risk & actions to mitigate risks and measures to improve preparedness
continuity in for resolution
resolution &
access to FMI
Identification, mapping and assessing of dependencies & FMI contingency plan
services
Information MIS for bail-in execution
systems &
data
requirements MIS for valuation
Communication Communication plan
Separability &
restructuring Separability and business reorganisation measures
In 2020, the SRB communicated For 2022, the SRB has set the following
annual working priorities common three common priorities to banks
to all banks under the SRB’s remit (see further details in section 2.2.1):
to facilitate a structured and for-
ward-looking implementation of the (i) liquidity and funding in resolution;
EfB. Using a sequential approach (ii) separability and reorganisation
and annual priorities that build on plans;
each other, with the IRTs monitoring
(iii) information systems and MIS
progress, the SRB is committed to
capabilities (for bail-in and
achieving resolvability of all banks5
valuation data).
under its remit by the end of 2023.
As in previous years, these priorities
For 2020 and 2021, the SRB commu-
are complemented by bank-specific
nicated common priorities focusing
priorities defined by the respective
on (i) bail-in operationalisation, in
IRT. The SRB communicated them
particular banks’ playbooks and MIS
to banks through ‘priority letters’ at
capabilities; (ii) operational continuity
the end of September 2021. In this
in resolution; (iii) access to Financial
context, based on the guiding princi-
Market Infrastructures (FMIs); (iv)
ples laid down in the EfB and MREL
liquidity and funding in resolution;
policy, the SRB provided banks with
and (v) availability of data required
additional operational guidance on
for valuation.
the arrangements banks should work
on in the course of 2022, as it did for
IRTs closely monitored banks’
the working priorities identified for
progress in implementing these
2020 and 2021.
priorities in the course of the reso-
lution planning activities and, where
The SRB is systemically enhancing
necessary, the SRB communicated
its guidelines to ensure that banks
areas of insufficient progress that
steadily make progress in their
could jeopardise the overall objective
laid down in the EfB.
5
For banks that are switched from insolvency to resolution preference in 2021 or later, an
adequate phase-in of 3 years would be granted to implement the SRB EfB.Single Resolution Board I Work Programme 2022 15
operational preparedness in all key In 2022, the SRB will monitor the
areas of the EfB. adherence of the SRB banks with the
BRRD2 MREL targets, which become
The EfB timeline specifies that banks binding as of 1 January 2022. If
have to establish MIS capabilities to breaches are detected, the legislative
deliver the liability data for bail-in framework provides the SRB with two
at short notice by the end of 2022. formal tools for addressing them:
Against this background, banks are by imposing restrictions relating to
expected to test their MIS capabilities the MREL-Minimum Distributable
for bail-in data through a dry-run. Amount (M-MDA) or, in situations
The latter will test banks’ bail-in where the shortfall impedes the
playbooks, which are to be submitted resolvability of institutions, by trig-
by the end of 2021, in line with the EfB. gering the substantive impediments
Banks will have to provide a report procedure with all the possible
on the outcome of the dry-run which, measures listed in the BRRD. Both
once reviewed by IRTs, will serve as SRB polices are already in place.
input for cross-cutting analysis.
Finally, the SRB will conduct the pre-
Additionally, through the above-men- paratory work for 2023, which is the
tioned 2022 priority letters, the SRB final year for the phase-in of the
formally identified areas of closer EfB, again with a view to providing
monitoring where a bank needs to support and guidance to banks in
make significant progress to ensure order to become fully resolvable.
resolvability by the end of 2023.
In such cases, additional evidence
should be provided by banks in
2.1.2.
order to enable the SRB to assess Operationalisation
the existence of impediments to
resolution. Depending on how sig-
of resolution plans
nificant these impediments are, the for SRB banks
SRB will ask the bank concerned
to address them either through The 2022 RPC starts in April 2022 and
corrective actions, under close mon- runs until March 2023 (cf. Figure 2
itoring by the IRT during the following below). However, this process
12-month period, or by starting the remains subject to a lengthy consul-
formal procedure for addressing sub- tation cycle that may lead to delays
stantive impediments provided for in beyond the SRB’s control. The SRB
the legal framework. This assessment and the NRAs, through the IRTs, are
will be conducted taking into account, carrying out the annual update of the
among others, the gradual phase-in resolution plans, using data with the
of EfB banks’ multi-annual work reference date 31 December 2021.
programme (delivered to the SRB The annual RPC benefits from regular
in January 2021 and to be updated lessons-learned exercises, to ensure
by the end of 2021) and the banks’ that each RPC is conducted more effi-
annual resolvability progress reports. ciently than the previous one.16 Single Resolution Board I Work Programme 2022
Figure 2: Timeline of the 2022 RPC for SRB banks
All SRB resolution plans will best-practice guide for the resolu-
be consulted with the ECB and tion plans and resolution strategies,
subject to internal quality control has been amended to require a
(cf. section 2.2.2.), which enables the clear comply-or-explain approach
2022 RPC to substantially improve when deviating from the estab-
the quality of the resolution plans. lished policies. This further ensures
The Single Rulebook is constantly compliance with the rulebook, high
evolving (as the EBA develops new standards and consistency in resolu-
RTS), and this makes the quality tion planning for SRB banks.
control process a dynamic assess-
ment – to ensure compliance with the Table 1 below provides an overview
evolving detailed rules. of the number of SRB banks for which
the SRB expects to adopt resolution
The Resolution Planning Manual plans and MREL decisions as part of
(RPM), which provides IRTs with a the 2022 RPC.Single Resolution Board I Work Programme 2022 17
Table 1: Overview of quantitative objectives planned for the 2022 RPC
Number of resolution Group resolution plans
MREL decisions expected to be
groups expected for the expected to be adopted
adopted during the 2022 RPC
2022 RPC [1] during the 2022 RPC
MS of which:
of which:
Simplified
Total with Total [3] External [5] Internal [6]
Obligations
Resolution [4]
Colleges [2]
AT 8 3 8 0 7 20
BE 6 2 6 0 5 8
BG 0 0 0 0 1 3
CY 3 0 3 0 3 2
DE 21 8 21 0 19 21
EE 1 0 1 0 1 0
EL 4 1 4 0 4 0
ES 11 2 10 0 11 6
FI 3 1 3 1 3 2
FR 13 4 11 2 10 29
HR 0 0 0 0 3 5
IE 6 3 6 0 2 11
IT 12 2 12 0 12 50
LT 1 0 1 0 1 0
LU 4 1 4 0 3 12
LV 1 0 1 0 1 0
MT 3 1 3 0 2 1
NL 7 1 7 2 7 7
PT 4 1 4 1 5 5
SI 3 0 3 0 3 4
SK 0 0 0 0 2 3
Total 111 30 108 6 105 189
Host cases Number of Resolution plans expected to be MREL decisions expected to be
[7] host cases adopted during the 2022 RPC adopted during the 2022 RPC
SE 6 2 6
BE 1 1 2
BG 1 1 1
[1] W
ithout prejudice of any change in the composition of the banking sector affecting the
number of groups within the SRB’s remit from the date of publication of this document.
With respect to banking groups for which the resolution strategy follows multiple-points-
of-entry (MPE) (i.e. application of resolution measures at the level of several resolution
entities located in MS), resolution groups are counted separately within a banking group.
This means that for countries where the number of banking groups exceeds the number
of resolution plans, it cannot be concluded that the SRB did not prepare RPs for certain
banks. The difference might be due to the fact that IRTs follow an MPE strategy for banks
in this country.
[2] Including European Resolution Colleges.
[3] T
he number of resolution plans is lower than the number of SRB banks, among others, due
to the fact that some SRB banks are part of another banking group under the SRB’s remit
and therefore are included in the respective group resolution plan.
[4] T
his figure is provisional, as the number of simplified obligations is subject to case-by-case
approval by the SRB Executive Session.
[5] At the resolution group level (i.e. including decisions for the sub-consolidated level).18 Single Resolution Board I Work Programme 2022
[6] T
he figures by country represent all subsidiaries of banking groups located in that country
(including subsidiaries of banking groups headquartered in another banking union MS)
not subject to a sub-consolidated MREL. Figures include cooperatives, in particular groups
subject to solidarity mechanisms in national legislation, which might be subject to a
dedicated MREL approach in the upcoming cycles.
[7] T
he host cases are in principle banking groups whose parent is headquartered in the
European Union but is not under direct responsibility of the SRB. Numbers are aggregated
under the MS of the banking group’s parent undertaking.
In 2022, the IRTs will perform an procedure for the removal of sub-
assessment of the bank recovery stantive impediments, as foreseen by
plans and provide comments to the the legal framework.
ECB. This assessment will, in turn,
provide input for the IRTs’ resolu- The SRB will further enhance public
tion planning activities and generally confidence by communicating how
enhance the IRTs’ crisis preparedness successfully banks manage to remove
in view of a potential transition from barriers to resolvability over time.
the recovery to the resolution phase.
2.1.4. The
2.1.3. Resolvability enhancement of the
assessment internal framework
and removal on deep-dive and
of impediments on-site inspections
for SRB banks (OSI) for SRB banks
In 2022, the resolvability assessment
Following the targeted pilot projects
heat map, implemented for the first
carried out by the IRTs in the 2021
time in the 2021 RPC, will capture
RPC, in 2022 the SRB will extend
the banks’ progress and allow bench-
the sample of the banks that will
marking against the 2022 priorities
be subject to deep-dives by their
(primarily separability, reorganisation
IRTs. The deep-dives will be carried
and the identification of collateral in
out by the IRTs as part of their res-
resolution). The results will be based
olution planning activities and will
on the IRTs’ resolvability assessments
constitute an extension of the IRT’s
included in the 2022 resolution plans
usual off-site activities. The deep-
and banks’ work programme commit-
dives are expected to be a significant
ments for the RPC.
step towards improving the SRB’s
expertise before launching ful-
This assessment, based on a set of
ly-fledged OSIs. All the deep-dive
harmonised criteria, is aimed at clas-
reports will be subject to consistency
sifying banks’ progress according to
analyses to ensure that the same
each resolvability condition and the
approach is applied to all banks’ deep
impact the latter has on the feasi-
dives and to pave the way to run
bility of the resolution strategy, or,
fully-fledged OSIs in the upcoming
where insufficient progress is noted,
years. Moreover, in 2022 the SRB will
helps to identify impediments in a
update its deep-dive guidance, based
consistent way, at different degrees
on the lessons learned from the 2021
of materiality. Where the progress
exercise. The deep-dives will be used
demonstrated by the bank shows
as a tool to further improve resolu-
that the bank is not likely to achieve
tion planning work and to check the
resolvability in line with the SRB’s
progress achieved by the banks in
expectations, the SRB will initiate the
line with the SRB EfB.Single Resolution Board I Work Programme 2022 19
yearly updates. Therefore, besides
2.1.5. Oversight the quantitative increase, the LSIs’
of less significant resolution plans notified by NRAs
provide more in-depth analyses and
institutions (LSIs) a higher degree of operationalisa-
tion, enabling the SRB to enhance its
The SRMR provides a clear division of expertise and oversight with regard
tasks between the SRB and NRAs with to LSIs. This development is expected
regard to the type of entities within to continue in 2022.
its scope. While the SRB is ultimately
responsible for drawing up plans Taking into account the above, the
and adopting all resolution-related SRB will continue to enhance the
decisions for significant institu- consistent application of high res-
tions and cross-border groups (both olution standards among the LSI
referred to as ‘SRB banks’), NRAs are resolution plans received from the
in charge of the same tasks for LSIs NRAs, with the ultimate goal of
in the banking union. With regard to ensuring their high quality and the
LSIs, the SRB maintains an oversight LSIs’ resolvability. For this purpose
function to ensure the consistent and to process efficiently a large
application of resolution standards number of notifications, the SRB will
within the banking union. Therefore, closely cooperate with the NRAs on
NRAs must submit to the SRB any a bilateral and/or multilateral basis
draft resolution measure they intend (e.g. at least two meetings of the LSI
to adopt for the LSIs under their Taskforce with all NRAs at staff level
direct responsibility, and the SRB may will take place in 2022). In particular,
express its views. a round of bilateral meetings with all
NRAs will take place in September-
According to the NRA data (April 2021), October 2022. Such bilateral and
the number of LSIs under their direct multilateral engagements involve
responsibility for which resolution ex-ante discussion of the NRAs’ policy
planning is required stands at 2 165. stances to be included in the draft
The resolution planning coverage resolution plans and other resolution
conducted by NRAs has been consist- planning approaches, with the aim of
ently increasing in the past few years, ensuring alignment with the SRB LSI
rising from 17.6% in 2017 to 51.7% Guidelines and thereby coherence
in 2018, and then to 85.3% in 2019 across the NRAs’ approaches, while
and 91.3% in the 2020 RPC. It is now remaining proportional. This was also
expected to reach 93.4% in the 2021 made possible by an increase in the
RPC and increase further in the 2022 number of SRB staff responsible for
RPC, progressively reaching 100%. In overseeing LSIs.
particular cases, some LSIs are not
covered by resolution planning due The LSI Guidelines are applied on a
to a number of technical factors such comply-or-explain basis, taking into
as entry into force of new regulatory account the principle of proportion-
frameworks and compliance with ality, while making reference to the
new policies, ongoing changes in the policies and guidance developed for
LSIs’ corporate structure and the fact SRB banks where there is no reason
that there is a number of newcomer to deviate (i.e. on grounds of speci-
LSIs for which no full information is ficity of the LSIs’ situation or national
yet available. specificities). The SRB and NRAs are
continuing to work in close cooper-
For the vast majority of LSIs under ation to ensure implementation and
the NRAs’ direct responsibility, NRAs the consistent application of the LSI
have already prepared at least one Guidelines as well as the propor-
iteration of the resolution plan, and tional application of the relevant SRB
in some cases have written several20 Single Resolution Board I Work Programme 2022
policies and guidance, in compliance SRB’s LSI risk management and
with Article 6 of the Guidelines. The strengthens crisis preparedness.
SRB also provides empirical analysis In particular, it allows the SRB to
and support to NRAs when perform- prepare in a timely manner when the
ing tasks for LSIs under their direct first signs of financial deterioration
responsibility. of an LSI emerge and provide prompt
feedback to the relevant NRA at the
Within the framework of the LSI moment of crisis, when the SRB will
oversight function, the SRB maintains have to assess the draft resolution
the Early Warning System for LSIs measure to be adopted by the NRA.
requiring closer monitoring, as laid In 2022, the SRB will further enhance
down in the Cooperation Framework6. its engagement with NRAs to ensure
This procedure contributes to the the overall LSI crisis preparedness.
2.2. Fostering a robust
resolution framework
the Resolution Committee (CoRes)
2.2.1. Development and relevant expert networks.
of SRB policies
MINIMUM REQUIREMENT FOR
Over the last few years, the SRB has OWN FUNDS AND ELIGIBLE
established and published its core LIABILITIES (MREL)
policies, so its focus is now shifting As part of the work on its resolution
from the completion and fine-tuning priorities, in 2022 the SRB will update
of the existing guidance towards oper- and further enhance its MREL policy.
ationalising the resolution strategy This is a key part of the work to opera-
and a more bespoke implementa- tionalise its resolution tools and both
tion of its policies, particularly to the Multiple Point-of-Entry (MPE) and
cater for diverging national laws. The Single Point-of-Entry (SPE) strategies.
latter justifies the SRB’s push towards This will be done, inter alia, by:
developing national handbooks and
the work on bank-specific playbooks, ►► Reviewing the NCWO approach:
with a tailored, ready-to-use and the SRB will enhance its NCWO
operational perspective. approach, and investigate possible
changes to the balance sheet when
The SRB will continue to integrate in approaching resolution. It will also
its policy work programme for 2022 assess discretionary exclusions to
the guidance from standard-setting feed into a new SRB policy and the
bodies at international and European NCWO approach for 2023.
level (the FSB and EBA). In particu- ►► Following-up any regulatory devel-
lar, the SRB will implement, where opments concerning the RTS on
relevant, RTS and ITS that the EBA will deductions for internal MREL in
deliver on execution of the rules of daisy chains.
the Banking Package. As in previous
►► Reassessing the MREL calibration
years, SRB policy work will be done in
for transfer strategies7, in par-
close cooperation with NRAs, through
ticular with a better link to the
6
https://www.srb.europa.eu/system/files/media/document/decision_of_the_srb_on_cofra.pdf
7
As explained in the 2021 MREL policy, the SRB tailors the adjustment factor to bank-specific
characteristics within a 10% corridor range with an upper limit of 25% and a lower limit of
15%.Single Resolution Board I Work Programme 2022 21
resolvability assessment progress EXPECTATIONS FOR BANKS (EFB)
(heat map) and the different reso- – GUIDANCE ON THE WORKING
lution strategies. PRIORITIES FOR 2022
►► Broadening further the scope of ►► Liquidity and funding in resolution
non-resolution entities subject
to internal MREL. The SRB will Building on the 2021 work on liquidity
continue lowering the materi- and funding in resolution, in 2022 the
ality threshold of relevant legal SRB will phase in EfB principle 3.3 and
entities, reducing it from 3% to 2% assess banks’ capabilities to identify,
in 2022. mobilise and monetise assets that
►► Implementing the new ‘permis- can be used as collateral in resolution.
sions regime’ as of 1 January 2022. Banks will be asked to focus on asset
The SRB will assess applications classes that are less likely to be used
according to the latest draft RTS in the recovery phase: non-marketable
and refine its policy in the case of assets (in particular credit claims) and,
changes when the RTS becomes a in general, assets not eligible for the
delegated regulation. ordinary central bank monetary facil-
►► Fine-tuning will also be made on ities. To support the resolution plan,
MPE, e.g. by reviewing the meth- assessment banks will be requested:
odology on the use of ‘surplus’ in (i) to identify and quantify the amount
third countries resolution groups. of collateral they hold for different
asset classes; (ii) to describe the
OPERATIONALISING SINGLE POINT operational steps (including the time
OF ENTRY (SPE) horizon and governance processes)
With a view to operationalising and to mobilise these asset classes; and
enhancing the credibility of the SPE (iii) to identify and address challenges
approach, the SRB will give further (legal, regulatory, operational, etc.) to
consideration to the practical aspects mobilise each asset class cross-border
of the implementation of the SPE in resolution (both within the EU and
strategies, including identification outside the EU).
of the legal and practical obstacles
to the transferability of funds from Solvent wind-down (SWD) of trading
the point of entry to its subsidiaries. books refers to approaches that may
Leveraging on the lessons learned be used for exiting trading activities in
from the resolution college dry-run an orderly manner and avoiding any
in April 2021, the SRB will follow up risks to financial stability. Such a tool is
on key elements, including: (a) the relevant for banks under business as
reliance on single versus multiple usual (i.e. as a recovery option), as an
failing or likely to fail (FOLTF) decla- element of the resolution strategy, and
rations in the case of a cross‑border as part of the post‑resolution Business
group crisis; (b) the identification of Reorganisation Plan (BRP). The
proper mechanisms (cf. Article 59 vs planning for these phases is closely
Article 63 of the BRRD) to ensure the interlinked. The policy will focus par-
transfer of subsidiaries’ losses to the ticularly on the context of resolution,
point of entry; and (c) the treatment under both the dimensions of financial
of losses of viable subsidiaries in the continuity and business reorganisation
resolution scheme. post-resolution. The main objectives
are (i) to adequately prepare, develop
As regards the extent of financial and maintain banks’ capabilities for
support in resolution, the SRB will the planning of a SWD in resolution,
give consideration, inter alia, to the whether as part of the resolution
usage of contractual arrangements strategy, or as actions implemented in
for making available resources to the post-resolution phase restructur-
subsidiaries, where necessary. ing context and (ii) to execute the SWD22 Single Resolution Board I Work Programme 2022
plan within a reasonable timeframe. by banks in a ‘BRP analysis report’).
The policy will be introduced in 2022, Although banks will not be requested
alongside operational guidance for to develop a fully-fledged BRP on a
banks with significant trading activities going-concern basis, they will nev-
and guidance on the first principles for ertheless be required to establish
IRTs. The final chapter of the guidance proper governance arrangements
will be drafted in 2022, for its applica- and provide an analysis of the main
tion in 2023. components of the BRP.
►► Separability and reorganisation ►► Management information systems
(MIS) capabilities
In 2022, the SRB will prioritise the EfB
dimension of ‘Separability & restruc- The SRB will request all SRB banks
turing’ and will request banks to to focus on the EfB dimension of
prepare business reorganisation and Management Information systems
separability analysis reports. (MIS) and data requirements.
Specifically, banks are expected to
To further operationalise the imple- complete the establishment of MIS
mentation of other resolution tools in capabilities for bail-in data by the end
addition to bail-in (i.e. transfer strate- of 2022. Banks will have to provide
gies), the SRB will continue to develop evidence, based on testing, as part
policy and guidance on separability. of the bank-specific deep-dives (for
Separability is defined in this context more information, see section 2.3.1.
as the bank’s ability to implement on crisis preparedness). SRB banks
a transfer of (i) legal entities, (ii) are expected to perform a simula-
business lines, or (iii) portfolios of tion of bail-in by the end of 2022. The
assets and liabilities at short notice outcome of the 2022 simulations will
to a third party. In particular, the be analysed through a monitoring
priority will be to work on separabil- report at the beginning of 2023. The
ity in order to operationalise partial latter will provide an overview of the
transfer tools (for relevant banks). banks’ progress on bail-in readiness
This work will need to be completed and promote a level playing field in
by the end of the 2023 RPC in line the banking union. Due to the utmost
with the phase in for this resolvability importance of valuation data for the
dimension in the EfB. preparation and implementation
of the resolution strategy, the SRB
Another priority for the 2022 RPC and expects banks to focus on MIS capabili-
beyond will consist in ensuring that, ties for valuation data and consistently
when open-bank-bail-in is defined implement the projects launched in
either as the preferred resolution previous cycles in order to achieve
strategy or as a variant, banks have complete MIS by the end of 2023.
the capability to draft BRPs that
would have to be delivered within PUBLIC INTEREST ASSESSMENT
1 month following bail-in execution (PIA) AND FINANCIAL STABILITY
(as required by the legislation and as ANALYSIS
detailed by principle 7.3 of the EfB). After the introduction of the policy
Since this requirement is intrinsically and guidance for the consideration of
linked to the use of the bail-in tool, it system‑wide events in the PIA for res-
is important that the relevant banks olution planning in the 2021 RPC, 2022
are capable to produce such a plan will see the introduction of further
to ensure their financial soundness policy enhancements for the PIA
and long-term viability. The SRB will including the assessment of Critical
develop internal guidance to support Functions at regional level, the critical-
the IRTs in assessing such capabil- ity of transactional accounts and the
ities (that are to be demonstrated assessment of protection of coveredSingle Resolution Board I Work Programme 2022 23
depositors / DGS. Moreover, work will quality review of the resolution
be initiated to enhance the reporting plans based on its methodology
criticality of capital market functions. developed in 2020, which has been
further improved in 2021 by taking
The analytical part of the work on into account the work on the resolv-
PIA and financial stability focuses ability assessment heat map. This
on a main deliverable taking the methodology examines the plans in
form of dashboards to support IRTs two phases, in order to foster har-
in their consistent assessments monised practices for banks under
in resolution planning. A similar the SRB’s remit and allow systematic
analysis is produced when perform- benchmarking of plans against policy
ing the PIA in a crisis case, and can developments. This leads to the year-
also be used for ad-hoc analysis and on-year improvement of the quality
briefs. Each dashboard is based on of the plans and their compliance
tools and models covering multiple with the evolving Single Rulebook
aspects of the PIA. In the 2022 RPC, (cf. Banking Package and related
specific focus will be on contagion Implementing Technical Standards
and network models, also looking (ITS), Regulatory Technical Standards
at contagion to non-bank financial (RTS), etc.). Finally, wherever the
institutions, e.g. the insurance sector, quality control identifies a need to
as well as a common framework to update or fine-tune SRB policies,
assess the real economic impact of the SRB works accordingly to revise
a bank failure and indirect contagion them8.
channels such as market analysis via
bonds and credit default swaps (CDS).
2.2.3. Monitoring of
In 2022, the SRB will finalise its com- and contributing to
putational workbench project, thus
providing a robust and modern
external policy and
platform for data-driven and econo- regulatory activity
metric analysis. The new platform will
enable the SRB to enhance its financial In 2022, the SRB will engage closely
stability models, including network with the European Commission,
contagion models and models European Parliament, Council of the
assessing impact on the real economy. European Union, the ECB and the
In terms of resolution reporting and EBA on relevant regulatory and policy
data exchange, the SRB will introduce issues. The priority topics for 2022 in
new tools supporting the MREL and terms of external policy and regula-
Total Loss Absorbing Capacity (TLAC) tory activity include:
calculations, improve its data quali-
ty‑checking procedures and extend its ►► the review of the CMDI framework;
data exchange with the ECB. ►► the discussions on strengthen-
ing the banking union, especially
2.2.2. Quality focused on the agreement of a
work plan for EDIS (closely linked
assurance of to the above) and cross-border
resolution plans and integration;
►► ongoing discussions on the
benchmarking provision of liquidity in resolution;
In line with its mandate, the SRB will ►► discussions regarding other leg-
continue to conduct a systematic islative files on financial services,
8
This is done in cooperation with NRAs and can be particularly important with new and
complex policies, after they have been implemented for the first time, such as – to give just
one example – the SRB’s updated approach to PIA for systemic-wide-events.You can also read
