Resolution plans

An essential task of the resolution authorities, under the current institutional framework, is to draw up resolution plans.

A resolution plan outlines the action to be taken in the event that an institution needs to be resolved. A resolution plan includes a description of the key characteristics and critical functions of the institution and identifies any impediments to its resolvability.

Furthermore, it identifies the most appropriate resolution tools for that particular institution and sets the level of the Minimum Requirement for Own Funds and Eligible Liabilities (MREL) that the institution must maintain.

More specifically, the Minimum Requirement for Own Funds and Eligible Liabilities for each credit institution is expressed as a percentage of the total amount of liabilities and own funds of the credit institution and is defined by the resolution authority.

The aim is to ensure that the owners/shareholders and creditors of the credit institution have sufficient loss-absorbing capacity during the restructuring of liabilities, without financial stability being put at risk or requiring public funds.

Resolution plans are drawn up for all institutions and are updated at least annually, in an aim to achieve an efficient resolution strategy for each institution. Thus, the orderly and smooth implementation of resolution actions is ensured to the greatest extent possible in the event that an institution should meet the required conditions.

It should be  noted that the Single Resolution Board (SRB) is the competent authority for drawing up resolution plans for cross-border groups and institutions that are directly supervised by ECB.

The SRB works in close cooperation with the Bank of Greece, which is the national resolution authority for credit institutions and remains responsible for drawing up resolution plans for all other institutions within  the scope of the SRM Regulation, as well as for institutions within the scope of BRRD only.

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