TITLE:
Recovery and Resolution Regimes in the Banking Union
AUTHORS:
Mejra Festić, Anita Peša, Marko Lukavac
KEYWORDS:
Recovery, Resolution, Banking Union, Bail-In
JOURNAL NAME:
Modern Economy,
Vol.12 No.1,
January
29,
2021
ABSTRACT: This paper explores the implications of European Union
(EU) legal regulations on approaches to tackling crisis situations in the
financial sector. It explains the role and mechanisms of EU institutions in the
process of monitoring and recovery of strategically important financial
entities inside banking union at the EU level as well as of central bank
members of the countries of the banking union. The purpose of the paper is to
examine the compliance of EU regulations with national legislation in order to
achieve preventive conditions of possible future crises and to protect national
economies and the economy of the entire EU in context of the spillover effect and risks arising from the
need of banks recovery due to realized losses of the same. The results evince
the implementation of EU directives in the national legislation
comprehensively, but practice demonstrated that the implementation of the same
ones resulted in additional problems that require further EU institutions
action and, in addition, different interpretations, i.e. evaluation of
directives such as so-called “public interest”, results in discrepancy of
approaches in managing open crisis situations.