State aid to banks (IVOR nr. 109) 2018/4.6:4.6 Conclusion

State aid to banks (IVOR nr. 109) 2018/4.6

4.6 Conclusion

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.

The main message of the present chapter is that – notwithstanding the introduction of the BRRD, SRM and DRI – State aid to banks remains relevant, the State aid control framework remains relevant and this PhD-study remains relevant.

State aid to banks remains relevant

Does State aid to banks have a future? It can be argued that Member States have become reluctant to grant State aid, since State aid would trigger resolu tion and the application of the bail-in tool. However, it should be recalled that the BRRD allows for some flexibility for Member States that wish to rescue banks without bailing-in creditors. As explained in section 4.4.1, there are three situations in which it is possible to grant State aid without triggering resolution. The most notable exception is the “precautionary recapitalisation” within the meaning of Art. 32(4)(d)(iii) BRRD or Art. 18(4)(d)(iii) SRM-Regulation. In that regard, the cases of Alpha Bank, Eurobank, Piraeus Bank and NBG (discussed in subsection 4.4.1) and MPS (discussed in subsection 4.4.5) have demonstrated that a “precautionary recapitalisation” is not only a hypothetical possibility, but a real possibility that has been applied in practice.

The State aid control framework remains relevant

The present chapter has shown that all forms of assistance have to comply with the State aid control framework.

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In case a Member State grants an aid measure that does not trigger resolution, it shall be conditional on final approval under the Union State aid framework. This follows from Art. 32(4)(d) BRRD.

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In case a Member State grants extraordinary public financial support through government stabilisation tools, it shall be conditional on prior and final approval under the Union State aid framework. This follows from Art. 38(10) and Art. 56(1) BRRD.

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In case resolution funds are used, it should comply with the relevant State aid provisions. This follows from recital 55 BRRD.

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In case the Single Resolution Fund (SRF) is used, the Commission shall apply to the use of the Fund the criteria established for the application of State aid rules as enshrined in Article 107 TFEU. This follows from Art. 19 SRM-Regulation.

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In case the ESM direct recapitalisation instrument (DRI) is used, it shall be in accordance with the State aid provisions under Art. 107 and 108 TFEU. This follows from Art. 1(3) of the ESM Guideline on Financial Assistance for the Direct Recapitalisation of Institutions.

This PhD-study remains relevant

As set out in chapter 1, the aim of this PhD-study is forward-looking. It is about providing a framework which can be used to establish whether a bank State aid decision complies with the principle of equal treatment. If there were no bank State aid decisions in the future, then this PhD-study would lose most of its relevance. However, as set out above, State aid to banks remains relevant and the State aid control framework remains relevant. As a consequence, this PhD-study remains relevant.

Deze functie is alleen te gebruiken als je bent ingelogd.