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The Commission presented a package of reforms to further strengthen the resilience of EU banks

The Commission presented a package of reforms to further strengthen the resilience of EU banks

On 23 November 2016 the European Commission issued a comprehensive package of reforms to further strengthen the resilience of EU banks. This package includes the draft amendments of four currently existing European legislative norms:

  • Capital Requirement Regulation (CRR)
  • Capital Requirement Directive (CRD)
  • Bank Recovery and Resolution Directive (BRRD)
  • Single Resolution Mechanism Regulation (SRMR)

The package should complete the post-crisis regulatory reforms by implementing some outstanding elements which are to a large extent in line with international development. This concerns in particular the area of market risk, counterparty credit risk, and capital requirements for exposures to central counterparties, introduction of binding Leverage Ratio and Net Stable Funding Ratio and additional requirements on Global Systemically Important Institutions.

In addition the package purports to be more proportionate to institutions' complexity, size and business profile and more growth-friendly. This includes e.g. the improvement of capacity of banks to lend to SMEs and to fund infrastructure projects.

The package also includes measures to further facilitate achieving deeper and more liquid EU capital markets to support the creation of a Capital Markets Union.

The legislative package is submitted to the European Parliament and to the Council for their consideration and adoption.