The Single Resolution Mechanism – The Second Pillar of the European Banking Union
Journal
Iustinianus Primus Law Review, Volume 8 Issue 2
Date Issued
2017
Author(s)
Zafiroski, Jovan
Abstract
The financial crisis from 2008 has exposed all the imperfectness of the EU financial
infrastructure threatening to endanger the existence of the common currency and of the entire
project for European integration. Profound reforms in the financial sector have started in order
to make European financial system more resilient to crises. As part of a broader plan for
completing the Economic and monetary union the European banking union has provided a
sound base for more institutional integration for regulation, supervision and resolution of the
credit institutions in the EU. One of the key elements of the Banking union is the Single
Resolution Mechanism that should provide resolution on supranational level for EU banks
with cross border activities. This article explains the need for a common resolution
mechanism on the EU level presents the legal framework regulating the Single Resolution
Mechanism, gives an overview of the resolution procedure and the structure of the newly
created mechanism. Furthermore, the paper explores possible impact of the creation of the
Single Resolution Mechanism in the EU integration process of a candidate country for EU
membership.
infrastructure threatening to endanger the existence of the common currency and of the entire
project for European integration. Profound reforms in the financial sector have started in order
to make European financial system more resilient to crises. As part of a broader plan for
completing the Economic and monetary union the European banking union has provided a
sound base for more institutional integration for regulation, supervision and resolution of the
credit institutions in the EU. One of the key elements of the Banking union is the Single
Resolution Mechanism that should provide resolution on supranational level for EU banks
with cross border activities. This article explains the need for a common resolution
mechanism on the EU level presents the legal framework regulating the Single Resolution
Mechanism, gives an overview of the resolution procedure and the structure of the newly
created mechanism. Furthermore, the paper explores possible impact of the creation of the
Single Resolution Mechanism in the EU integration process of a candidate country for EU
membership.
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