- New guidance builds on previously issued “Expectations for banks”
- Targets banks’ capacity to measure and report liquidity in resolution
Today. 16 June, the SRB published new guidance on liquidity in resolution data for 115 of Europe’s largest banks. The guidance document targets the liquidity dimension of the SRB’s previously issued “Expectations for banks” aiming at enhancing banks’ resolvability and preparedness for a potential resolution. In case of resolution, liquidity is a key element in making sure a bank is resolvable.
The guidance focuses on three objectives:
- the expectation that banks’ internal frameworks, governance and management information systems are set up to meet the data expectations set out in the guidance, including the ability to forecast the net liquidity position across time periods and at short notice;
- the expectation SRB banks have developed the capabilities to report a predefined set of data points on their liquidity situation;
- the expectation that banks have put in place remedial actions to mitigate any deficiencies in their capabilities to provide these data points at the requested level of consolidation and at a high level of frequency.
Speaking ahead of the publication of the guidance, SRB Chair, Dominique Laboureix said “This guidance is about putting further meat on the bones of our plans to ensure every bank can be dealt with in a crisis situation. Our goal at the SRB is to make sure that if a major bank in the Banking Union gets into trouble, that we can deal with it swiftly, providing confidence to the market and the consumer, while not having to dip into taxpayers’ funds. The right information about liquidity is essential to achieve these goals.”
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