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‘To Fail or Not to Fail?’ Online seminar

The Florence School of Banking and Finance hosted on 5 July 2017 an online seminar on banking resolution, entitled ‘To Fail or Not to Fail?’.

The seminar featured a compelling presentation by Christos Gortsos, Professor of Public Economic Law at the Law School of the National and Kapodistrian University of Athen and, from late 2017, Fernand Braudel Senior Fellow at the European University Institute. In his talk, Professor Gortsos outlined the conditions for the resolution of credit institutions under Article 32(1) of the Bank Recovery and Resolution Directive and Article 19 of the Single Resolution Mechanism Regulation, higlighting how they were applied and what were their outcomes in the recent cases of Spanish and Italian banks.

The seminar continued then with a comment from Seraina Grünewald, Assistant Professor for Financial Market Law at the Institute of Law of the University of Zurich and a qualified lawyer.

The event was followed by participants representing 49 nationalities, connecting from Europe and beyond. Contributions by the speakers were followed by an interactive Q&A session, moderated by Pierre Schlosser (Scientific Coordinator, Florence School of Banking and Finance), during which participants touched upon topics such as the BRRD, conditions for bank resolution and comments on the recent cases. Participants were also asked to provide their real-time feedback on a number of issues, namely:

  • Should there be “harder” (metric) criteria in determining whether an institution is failing or likely to fail? Yes: 51%, No: 49%
  • Was the ‘public interest in financial stability’ test applied correctly in the cases of the “troubled” Italian credit institutions? Yes: 18%, No: 82% %
  • Is resolution without bail-in of senior bondholders again possible? Yes: 66%, No: 34% %
  • Are private sector/national insolvency law measures a loophole in or an integral part of the resolution framework? Loophole: 69%, Integral part: 31%

The recording of the presentations is available here:

Download the slides of the presentation by Christos Gortsos