Single Resolution Fund grows by €13.7 billion to reach €66 billion

Fund to support bank resolution, paid for by the industry Every bank, big or small, operating across the 21-country Banking Union required to pay annual levy called a ‘contribution’Today, the Single Resolution Board (SRB) announced the amount of contributions being made by banks to the Single Resolution Fund (SRF) for 2022. All banks in the Banking Union and some investment firms are required by law to pay annual levies into this emergency fund. For this year, banks are paying €13.7 billion into the SRF. The target size of the SRF is set at 1% of covered deposits by the end of next year. The Fund will end up at around €80 billion, taking into account the current annual growth in covered deposits. The SRF can be used to support the effective resolution of a failing bank, if needed. The SRF is just one of the tools of the financial stability structure that was put in place in the wake of the 2008/2009 banking crisis. It is being built up over eight years until 2023. The Fund will see its effective capacity approximately doubled when the public Backstop to the SRF is introduced. “We continue to build up the SRF and it is on track to be fully stocked[1] next year. The growing capacity of the Fund, improves SRB’s ability to preserve financial stability and to protect tax payers from bail-outs. The backstop once in force will significantly increase the firepower of the Fund. This will go a considerable way to ensuring public money does not have be used to bail-out private...