Press Release

Clarity for bank shareholders, but no taxpayers' money

Brussels
, 10.10.2017 - 12:04
Bank sign on building

The Banking Recovery and Resolution Directive (BRRD) changed the logic of the European financial markets. It has clarified that shareholders and investors must take on the losses themselves. They can no longer expect governments and taxpayers to bail them out. This is a principle that applies to all regular companies and now also to banks in the European Union.

Today, the European Parliament’s Economic and Monetary Affairs Committee adopted its position on the Directive on the ranking of unsecured debt instruments in insolvency proceedings (bank creditor hierarchy). "This proposal will improve the resilience of European banks and bring our legislation into line with new prudential international standards", said EP Rapporteur Gunnar Hökmark MEP.

The creditor hierarchy proposal is part of a legislative package aimed at reducing risks in the EU banking industry. It creates a new asset class of ‘non-preferred’ senior debt with the intention of enhancing resolvability and minimising the compliance costs stemming from differing subordination approaches in Member States. The European Parliament broadly supports the European Commission proposal while recognising that this approach may not be easily accommodated in a number of Member States where a statutory subordination has been enshrined in national legislation. Therefore, in order to ensure legal certainty for investors and issuers, transitional arrangements need to be put in place.

"For depositors and investors, this new proposal provides legal clarity and certainty which also gives security", concluded Gunnar Hökmark MEP.

Note to Editors
The EPP Group is the largest political group in the European Parliament with 216 Members from 27 Member States

MEP Contacts

-
Gunnar HÖKMARK
BRU - Phone: +32 (0)2 2845822 Fax: +32 (0)2 2849822
Email: gunnar.hokmark@europarl.europa.eu

Press Contacts

Lina Stenlund
Swedish press; Communications Strategy; Afghanistan
Phone: +32 485 911 164

Latest

Daphne Caruana Galizia
17.10.2017 - 15:25

Daphne Caruana Galizia: EPP Group calls for full inquiry

"The murder of prominent investigative journalist Daphne Caruana Galizia in Malta is tragic proof that the concerns regarding the...
worker
16.10.2017 - 17:51

Breakthrough in EU legislation on posting of workers

“Today, after 18 months of intensive negotiations, we have set up a common position on the posting of workers with clear rights for the more...
Brexit Direction Sign
12.10.2017 - 17:10

Brexit talks: UK government must get a grip on exit bill

There is growing unease in the EPP Group in the European Parliament on the progress in the Brexit negotiations between the EU and the UK: ...
Making online shopping easier with fair shipping prices
12.10.2017 - 16:15

Making online shopping easier with fair shipping prices

The European Parliament’s Transport Committee has approved legislation that would require more transparency and closer regulatory oversight of...

Highlights of the week

16.10.2017 - 20.10.2017
Group portrait of industry workers

Towards better protection for posted workers

Members of the Employment Committee on Monday will vote on the revision of the Posting of Workers Directive spearheaded by Elisabeth Morin-Chartier...
Syrian Refugees

Solidarity and flexibility should be core in granting asylum

The reform of the Dublin System which sets the rules for granting asylum in Member States will be voted on by the Civil Liberties Committee on...
Travel

New system to strengthen Europe's border security

The Civil Liberties Committee will vote on Thursday on 'Establishing a European Travel Information and Authorisation System' (ETIAS),...
Niall Downey