SRB publishes report on smaller banks in the Banking Union for the first time

Press releases

Thursday, 05 October 2023

For the first time, the SRB publishes report on resolution planning and crisis management for smaller banks, known as less significant institutions (LSIs)
Report examines key developments in LSI sector, gives account of NRAs’ resolution planning and crisis management activities in 2022 & 2023 and explains the SRB’s role on LSIs in the Banking Union

The Single Resolution Board (SRB) has today published a report on resolution planning and crisis management for less significant institutions (LSIs) for the first time. These are banks under the direct responsibility of national resolution authorities (NRAs), while the SRB has an oversight role.

Speaking from Brussels, SRB Chair Dominique Laboureix said, “I take good note of the resolution planning coverage for LSIs is nearly complete. The national resolution authorities and the SRB, as part of the Single Resolution Mechanism will continue to work to enhance crisis preparedness for smaller banks.”

The report is based on the information made available to the SRB up until March 2023 and concerns the total of approximately 2000 LSIs. About three quarters of these banks belong to cooperative or savings networks, while the remaining 500 LSIs are characterised by both traditional and special business models, the latter including custodian and investment banks and financial market infrastructures.

The number of LSIs covered by resolution planning has grown steadily since the inception of the Single Resolution Mechanism (SRM). The total coverage has reached 97% in the latest 12-month resolution planning cycle (RPC) and is expected to soon become complete.

Despite challenging market conditions, those LSIs earmarked for resolution have continued building up their capacities in terms of minimum requirement for eligible liabilities and own funds (MREL).