Public funding of failing banks in the European Union (LBF vol. 19) 2020/5.3.6.2:5.3.6.2 Resolution is combined with normal insolvency proceedings

Public funding of failing banks in the European Union (LBF vol. 19) 2020/5.3.6.2

5.3.6.2 Resolution is combined with normal insolvency proceedings

Deze functie is alleen te gebruiken als je bent ingelogd.Deze functie is alleen te gebruiken als je bent ingelogd.Deze functie is alleen te gebruiken als je bent ingelogd.

Once the resolution authority has taken the decision to put a bank in resolution, normal insolvency proceedings should be excluded, unless they need to be combined with the use of the resolution tools and at the initiative of the resolution authority.1 For example, in the event of a partial transfer of assets of a bank in resolution to a private purchaser or to a bridge bank, the residual part of the bank in resolution should be wound up in normal insolvency proceedings.2 In such a case, a Member State may be willing – following the request from the bank in resolution – to provide liquidation aid to the bank.3

In the case of BANIF, Portugal re-notified the rescue recapitalisation aid that was granted to BANIF as liquidation aid, because BANIF would exit the market as a result of the resolution strategy. The Commission considered this aid award to be compatible with the internal market on the basis of Article 107(3)(b) TFEU.4

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