Asmussen said he was 'adamantly convinced' that the Banking Union would only function if the SSM was complemented by an SRM, and that it was of 'utmost importance' to have a political agreement on the SRM by the end of this year.
Our preparations to take over the task of the SSM are well under way. We are adamantly convinced that Banking Union will only function if the SSM is complemented by a single resolution mechanism and that it is put in place without undue delay. Given the parliamentary recess as of May next year in view of the upcoming elections to the European Parliament, it is of utmost importance to have a political agreement on the Single Resolution Mechanism in the ECOFIN by the end of this year.
To make this happen, all need to move. The following are the main open issues that need to be solved:
First, the legal base: Article 114 of the EU Treaty on the establishment and functioning of the internal market is a possible legal base from our point of view, but it could also be based on the flexibility clause of Article 352.
Second, the scope: The Commission proposal foresees that all banks in countries participating in the SSM should be covered by the SRM as well. My personal view is that a compromise should be possible here. Why not start with the systemic SSM banks, i.e. the 130 for which the ECB will be the direct supervisor, and progress further over time?
Third, the resolution authority: It must fulfil three criteria. It has to be in a position to take decisions quickly, if needed during a weekend. That said, it is obvious that the Council cannot be the resolution authority. The resolution authority must be established quickly. That means there is no time to wait for a treaty change to establish a new institution. The new authority must take a European perspective on financial stability. Let me be clear that I do not see the task of the resolution authority with the ECB. There should be a clear division of labour between supervision and resolution.
The fourth and last big open issue is how to finance the backstop for the single resolution fund as long as it is not sufficiently funded via levies from the banking sector. As mentioned before, I think the ESM including any non euro-area Member States could provide a credit line to the resolution fund. That would guarantee a clear control over the resolution fund by the participating Member States and their parliaments.
A functioning Banking Union is in the best interest of Europe and it is in the best interest of Germany.
Full speech
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