National interests and supranational resolution in the European banking union
- We investigate whether the bank crisis management framework of the European banking union can effectively bar the detrimental influence of national interests in cross-border bank failures. We find that both the internal governance structure and decision making procedure of the Single Resolution Board (SRB) and the interplay between the SRB and national resolution authorities in the implementation of supranationally devised resolution schemes provide inroads that allow opposing national interests to obstruct supranational resolution. We also show that the Single Resolution Fund (SRG), even after the ratification of the reform of the European Stability Mechanism (ESM) and the introduction of the SRF backstop facility, is inapt to overcome these frictions. We propose a full supranationalization of resolution decision making. This would allow European authorities in charge of bank crisis management to operate autonomously and achieve socially optimal outcomes beyond national borders.
Author: | Tobias TrögerORCiDGND, Anastasia KotovskaiaGND |
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URN: | urn:nbn:de:hebis:30:3-644990 |
URL: | https://ssrn.com/abstract=4024343 |
DOI: | https://doi.org/10.2139/ssrn.4024343 |
Parent Title (English): | SAFE working paper ; No. 340 |
Series (Serial Number): | SAFE working paper (340) |
Publisher: | SAFE |
Place of publication: | Frankfurt am Main |
Document Type: | Working Paper |
Language: | English |
Year of Completion: | 2022 |
Year of first Publication: | 2022 |
Publishing Institution: | Universitätsbibliothek Johann Christian Senckenberg |
Release Date: | 2022/02/09 |
Tag: | ESM; SRB; SRF; bail-in; bank resolution; banking union; bureaucrats' incentives; national interest; political economy |
Issue: | February 2022 |
Page Number: | 29 |
Note: | The paper benefitted greatly from discussions at the Center for Advanced Studies Foundations of Law and Finance (CAS LawFin) funded by the German Research Foundation project number 392809952. |
HeBIS-PPN: | 492816018 |
Institutes: | Wirtschaftswissenschaften / Wirtschaftswissenschaften |
Wissenschaftliche Zentren und koordinierte Programme / House of Finance (HoF) | |
Wissenschaftliche Zentren und koordinierte Programme / Center for Financial Studies (CFS) | |
Wissenschaftliche Zentren und koordinierte Programme / Sustainable Architecture for Finance in Europe (SAFE) | |
Dewey Decimal Classification: | 3 Sozialwissenschaften / 33 Wirtschaft / 330 Wirtschaft |
Sammlungen: | Universitätspublikationen |
Licence (German): | Deutsches Urheberrecht |