The EU is already starting to recruit, yet the body is unlikely to reach the required 300 employees by January 2016, when the Board will have its full resolution powers. At the top of the SRB, 6 banking experts, including Antonio Carrascosa, the general director of the Spanish FROB, will act as one of three managers charged with designing the restructuring process.
The European Commission and the ECB will sit on the Board, but will not have voting power in resolution cases. Until now, it has been up to Member States to resolve cases, yet it is hoped that measures currently being implemented will lay the groundwork for the SRB to function effectively in the years ahead.
“We are not yet working with National Resolution Plans, we have to see how far these authorities have gone in the process” an EU official said but added that “in Spain, the UK or even Greece there are solid entities”.
The chairman of Germany’s Financial Supervisory Authority or the State Pension Fund director from Finland will join the Board with Carrascosa. If endorsed by the European Council this Thursday or Friday, they will work in parallel with national resolution authorities. The organisation mechanism has raised some doubts in Brussels.
“We recommend reducing national board competences”, explains Karel Lannoo, economist and CEO from the Center for European Policy Studies. Lannoo added with regard to supervision in the EU that “it’s extremely important to move the competencies to the ECB side”.
There is one idea persistently floating around in Brussels. That is the notion that the 8 year process to create the resolution fund and indeed the € 55 billion firepower allocated will not be sufficient to tackle systemic banks.
“Our objective is a non-State scenario”, said an EU source who wished to remain anonymous. The goal is “to resolve banks with the institution, sending a message to investors and shareholders that they have to take care and assume a bail-in reality”.
Nevertheless, the SRB starts work on developing resolution plans for credit institutions in less than one month, just after New Year´s Eve.