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Binder, Jens-Hinrich --- "Cross-border coordination of bank resolution in the EU: all problems resolved?" [2019] ELECD 1624; in Haentjens, Matthias; Wessels, Bob (eds), "Research Handbook on Cross-Border Bank Resolution" (Edward Elgar Publishing, 2019) 30

Book Title: Research Handbook on Cross-Border Bank Resolution

Editor(s): Haentjens, Matthias; Wessels, Bob

Publisher: Edward Elgar Publishing

Section: Chapter 2

Section Title: Cross-border coordination of bank resolution in the EU: all problems resolved?

Author(s): Binder, Jens-Hinrich

Number of pages: 27

Abstract/Description:

Among the technical challenges that continue to have an impact on the effective resolution of large, complex, internationally active banking institutions and groups, the cross-border coordination of measures taken in different jurisdictions clearly is one of the most difficult to address. Given complex – and usually conflicting – vested national interests in home and host jurisdictions, cooperation requires not just a robust decision-making infrastructure, but also depends on the predictability of the economic outcomes of resolution – and on the fairness and reliability of ex ante commitments to joint burden-sharing. Given the dimension of these preconditions, it is hardly surprising that some jurisdictions, including, notably, the USA, have opted for ‘isolationist’, unilateral resolution actions vis-à-vis foreign-owned banks instead. The present chapter critically evaluates the new framework for cross-border bank resolution under the European Bank Recovery and Resolution Directive and the Single Resolution Mechanism as a counter-example, and identifies residual shortcomings in this regard.