On 6th June 2018 the European Commission published a report providing an overview of the progress achieved with respect to risk reduction measures (RRMs) and to present the impact of RRMs already implemented at EU and national levels.
Since the onset of the financial crisis, the EU has adopted over fifty legislative proposals to increase the resilience of the financial sector. Large part of the legislation has already been agreed and is in force, many other proposals are on the table and in a different stage of the legislative process. Firstly, this includes the so-called Risk reduction package (sometimes also called Banking package), i.e. amendments to the BRRD/SRMR/CRR/CRD where a General Approach has been adopted by the Council on 25 May 2018. Secondly, there are risk sharing measures. However, no further progress was achieved in recent months regarding proposals on the creation of a European Deposit Insurance Scheme (EDIS), which was adopted by the Commission already in November 2015. Similarly, no decisions have been made yet on the implementation of a backstop to the Single Resolution Fund (SRF).
Annex I of the report offers a granular view of all legislative measures relevant for the banking sector (starting 2012). It includes also the newly published Commission proposals on addressing non-performing loans and sovereign bond-back securities about which we informed in separate articles – see here and here. Annex II presents the actual legislative transposition of the most important Directives by Member States. Annex III brings a non-exhaustive overview other national measures taken in addition to transposing EU agreed legislation. Moreover, in Annex IV one can find a quantitative analysis of the evolution of certain indicators per Member State and how they contributed to reducing risks (e.g. capital ratio, liquidity, leverage, non-performing loans and Minimum Requirement for own funds and Eligible Liabilities, i.e. MREL).
18-9-2018