The Credit Suisse (CS) failure in March 2023 was the first time that the crisis management and resolution framework put in place after the global financial crisis (GFC) was faced with a serious test. Long-standing problems with management, organisation and culture had led to a gradual erosion of confidence and eventually depositor flight. Despite advance planning for resolution in close cooperation with their foreign counterparts, the Swiss authorities chose not to execute their resolution plan for CS. Instead, the Swiss government issued emergency regulations to facilitate a takeover of Credit Suisse by UBS. The approach that was chosen departed from the pre-ordained one, but it addressed the bank’s failure in a manner that maintained financial stability and prevented contagion. The episode taught important lessons about the implementation of international resolution standards.
{"title":"The failure of a global systemically important bank – Lessons for crisis management and resolution","authors":"Eva H. G. Hüpkes","doi":"10.15375/zbb-2024-0116","DOIUrl":"https://doi.org/10.15375/zbb-2024-0116","url":null,"abstract":"\u0000 The Credit Suisse (CS) failure in March 2023 was the first time that the crisis management and resolution framework put in place after the global financial crisis (GFC) was faced with a serious test. Long-standing problems with management, organisation and culture had led to a gradual erosion of confidence and eventually depositor flight. Despite advance planning for resolution in close cooperation with their foreign counterparts, the Swiss authorities chose not to execute their resolution plan for CS. Instead, the Swiss government issued emergency regulations to facilitate a takeover of Credit Suisse by UBS. The approach that was chosen departed from the pre-ordained one, but it addressed the bank’s failure in a manner that maintained financial stability and prevented contagion. The episode taught important lessons about the implementation of international resolution standards.","PeriodicalId":509014,"journal":{"name":"Zeitschrift für Bankrecht und Bankwirtschaft","volume":"44 5","pages":""},"PeriodicalIF":0.0,"publicationDate":"2024-02-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139836375","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The third Panel of the SRB Legal Conference, moderated by Tuija Taos, focused on various aspects of cross-border bank resolutions and how events have shown that a banking crisis can occur very quickly. There was consensus on the importance of being very well prepared to react with the same speed. Authorities and institutions must have solid plans and always be prepared for the unexpected. This was the first time since 2008 that a global systemically important bank was under severe stress and the resolution framework was put to the test. When facing cross-border bank resolutions, legal regimes need to be credible and workable. There is no doubt that the authorities currently have the necessary powers and tools.
{"title":"Panel III – Cross-Border Bank Resolutions and its challenges","authors":"Yago Fernandez Badia","doi":"10.15375/zbb-2024-0113","DOIUrl":"https://doi.org/10.15375/zbb-2024-0113","url":null,"abstract":"\u0000 The third Panel of the SRB Legal Conference, moderated by Tuija Taos, focused on various aspects of cross-border bank resolutions and how events have shown that a banking crisis can occur very quickly. There was consensus on the importance of being very well prepared to react with the same speed. Authorities and institutions must have solid plans and always be prepared for the unexpected. This was the first time since 2008 that a global systemically important bank was under severe stress and the resolution framework was put to the test. When facing cross-border bank resolutions, legal regimes need to be credible and workable. There is no doubt that the authorities currently have the necessary powers and tools.","PeriodicalId":509014,"journal":{"name":"Zeitschrift für Bankrecht und Bankwirtschaft","volume":"59 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2024-02-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139775181","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The March 2023 turmoil, the most significant banking stress since the Great Financial Crisis, exposed vulnerabilities in governance, risk management, and supervisory practices. This article delves into this multifaceted financial turmoil, offering critical insights into the dynamics of systemic banking stress, regulatory responses, and the evolving challenges financial authorities face.
{"title":"Lessons from the March 2023 bank turmoil","authors":"Elena Carletti, Samir Kiuhan-Vásquez","doi":"10.15375/zbb-2024-0114","DOIUrl":"https://doi.org/10.15375/zbb-2024-0114","url":null,"abstract":"\u0000 The March 2023 turmoil, the most significant banking stress since the Great Financial Crisis, exposed vulnerabilities in governance, risk management, and supervisory practices. This article delves into this multifaceted financial turmoil, offering critical insights into the dynamics of systemic banking stress, regulatory responses, and the evolving challenges financial authorities face.","PeriodicalId":509014,"journal":{"name":"Zeitschrift für Bankrecht und Bankwirtschaft","volume":"10 4","pages":""},"PeriodicalIF":0.0,"publicationDate":"2024-02-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139776236","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This article deals in particular with the right to property of shareholders and creditors suffering from the negative consequences of bank resolution. Although the General Court recognizes the possibility of de facto infringements or expropriations falling within the scope of Article 17 of the Charter, the Court of Justice is reluctant in that regard. The application of the “no creditors worse off principle” may provide for the necessary protection under the condition, however, that a valuable ex ante evaluation of the bank´s assets is assured.
{"title":"Bank Resolution and Fundamental Rights","authors":"Juliane Kokott","doi":"10.15375/zbb-2024-0109","DOIUrl":"https://doi.org/10.15375/zbb-2024-0109","url":null,"abstract":"\u0000 This article deals in particular with the right to property of shareholders and creditors suffering from the negative consequences of bank resolution. Although the General Court recognizes the possibility of de facto infringements or expropriations falling within the scope of Article 17 of the Charter, the Court of Justice is reluctant in that regard. The application of the “no creditors worse off principle” may provide for the necessary protection under the condition, however, that a valuable ex ante evaluation of the bank´s assets is assured.","PeriodicalId":509014,"journal":{"name":"Zeitschrift für Bankrecht und Bankwirtschaft","volume":"37 ","pages":""},"PeriodicalIF":0.0,"publicationDate":"2024-02-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139834974","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The Credit Suisse (CS) failure in March 2023 was the first time that the crisis management and resolution framework put in place after the global financial crisis (GFC) was faced with a serious test. Long-standing problems with management, organisation and culture had led to a gradual erosion of confidence and eventually depositor flight. Despite advance planning for resolution in close cooperation with their foreign counterparts, the Swiss authorities chose not to execute their resolution plan for CS. Instead, the Swiss government issued emergency regulations to facilitate a takeover of Credit Suisse by UBS. The approach that was chosen departed from the pre-ordained one, but it addressed the bank’s failure in a manner that maintained financial stability and prevented contagion. The episode taught important lessons about the implementation of international resolution standards.
{"title":"The failure of a global systemically important bank – Lessons for crisis management and resolution","authors":"Eva H. G. Hüpkes","doi":"10.15375/zbb-2024-0116","DOIUrl":"https://doi.org/10.15375/zbb-2024-0116","url":null,"abstract":"\u0000 The Credit Suisse (CS) failure in March 2023 was the first time that the crisis management and resolution framework put in place after the global financial crisis (GFC) was faced with a serious test. Long-standing problems with management, organisation and culture had led to a gradual erosion of confidence and eventually depositor flight. Despite advance planning for resolution in close cooperation with their foreign counterparts, the Swiss authorities chose not to execute their resolution plan for CS. Instead, the Swiss government issued emergency regulations to facilitate a takeover of Credit Suisse by UBS. The approach that was chosen departed from the pre-ordained one, but it addressed the bank’s failure in a manner that maintained financial stability and prevented contagion. The episode taught important lessons about the implementation of international resolution standards.","PeriodicalId":509014,"journal":{"name":"Zeitschrift für Bankrecht und Bankwirtschaft","volume":"101 5","pages":""},"PeriodicalIF":0.0,"publicationDate":"2024-02-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139776795","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This article deals in particular with the right to property of shareholders and creditors suffering from the negative consequences of bank resolution. Although the General Court recognizes the possibility of de facto infringements or expropriations falling within the scope of Article 17 of the Charter, the Court of Justice is reluctant in that regard. The application of the “no creditors worse off principle” may provide for the necessary protection under the condition, however, that a valuable ex ante evaluation of the bank´s assets is assured.
{"title":"Bank Resolution and Fundamental Rights","authors":"Juliane Kokott","doi":"10.15375/zbb-2024-0109","DOIUrl":"https://doi.org/10.15375/zbb-2024-0109","url":null,"abstract":"\u0000 This article deals in particular with the right to property of shareholders and creditors suffering from the negative consequences of bank resolution. Although the General Court recognizes the possibility of de facto infringements or expropriations falling within the scope of Article 17 of the Charter, the Court of Justice is reluctant in that regard. The application of the “no creditors worse off principle” may provide for the necessary protection under the condition, however, that a valuable ex ante evaluation of the bank´s assets is assured.","PeriodicalId":509014,"journal":{"name":"Zeitschrift für Bankrecht und Bankwirtschaft","volume":"8 5","pages":""},"PeriodicalIF":0.0,"publicationDate":"2024-02-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139775274","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This article summarises and puts into context the limited but important case law of the European Court of Human Rights concerning bank resolution procedures, in particular under Article 6 (the right to a fair trial before an independent and impartial tribunal established by law) and Article 1 of the First Protocol (the right of property), as well as the important issue of who has standing under Article 34 to bring proceedings in the name or on behalf of an affected affected bank, its (former) management, share holders, bond holders, creditors or others affected.
{"title":"Bank Resolution and Fundamental Rights – A view from Strasbourg","authors":"T. Eicke","doi":"10.15375/zbb-2024-0110","DOIUrl":"https://doi.org/10.15375/zbb-2024-0110","url":null,"abstract":"\u0000 This article summarises and puts into context the limited but important case law of the European Court of Human Rights concerning bank resolution procedures, in particular under Article 6 (the right to a fair trial before an independent and impartial tribunal established by law) and Article 1 of the First Protocol (the right of property), as well as the important issue of who has standing under Article 34 to bring proceedings in the name or on behalf of an affected affected bank, its (former) management, share holders, bond holders, creditors or others affected.","PeriodicalId":509014,"journal":{"name":"Zeitschrift für Bankrecht und Bankwirtschaft","volume":"16 6","pages":""},"PeriodicalIF":0.0,"publicationDate":"2024-02-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139776577","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"SRB Legal Conference 2023: EU and Banking Union Law in a European and Global Context","authors":"Karl-Philipp Wojcik","doi":"10.15375/zbb-2024-0103","DOIUrl":"https://doi.org/10.15375/zbb-2024-0103","url":null,"abstract":"","PeriodicalId":509014,"journal":{"name":"Zeitschrift für Bankrecht und Bankwirtschaft","volume":"431 4","pages":""},"PeriodicalIF":0.0,"publicationDate":"2024-02-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139833992","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This note considers human rights review of resolution decisions and processes – a context in which property rights can be limited or suspended given the operation of resolution decisions, including bail-in and sale decisions – in the context of the UK resolution regime and the relevance of the European Convention on Human Rights (the Convention) and the Charter of Fundamental Rights of the EU (the Charter) following the withdrawal of the UK from the EU. It outlines the UK framework, considers the current approach to rights review, and closes with the implications of the UK withdrawal from the EU on rights review, ex ante and ex post, against the Convention and Charter.
{"title":"Bank Resolution and the European Convention on Human Rights – A Note from the UK","authors":"Niamh Moloney","doi":"10.15375/zbb-2024-0111","DOIUrl":"https://doi.org/10.15375/zbb-2024-0111","url":null,"abstract":"\u0000 This note considers human rights review of resolution decisions and processes – a context in which property rights can be limited or suspended given the operation of resolution decisions, including bail-in and sale decisions – in the context of the UK resolution regime and the relevance of the European Convention on Human Rights (the Convention) and the Charter of Fundamental Rights of the EU (the Charter) following the withdrawal of the UK from the EU. It outlines the UK framework, considers the current approach to rights review, and closes with the implications of the UK withdrawal from the EU on rights review, ex ante and ex post, against the Convention and Charter.","PeriodicalId":509014,"journal":{"name":"Zeitschrift für Bankrecht und Bankwirtschaft","volume":"85 ","pages":""},"PeriodicalIF":0.0,"publicationDate":"2024-02-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139834911","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This article summarises and puts into context the limited but important case law of the European Court of Human Rights concerning bank resolution procedures, in particular under Article 6 (the right to a fair trial before an independent and impartial tribunal established by law) and Article 1 of the First Protocol (the right of property), as well as the important issue of who has standing under Article 34 to bring proceedings in the name or on behalf of an affected affected bank, its (former) management, share holders, bond holders, creditors or others affected.
{"title":"Bank Resolution and Fundamental Rights – A view from Strasbourg","authors":"T. Eicke","doi":"10.15375/zbb-2024-0110","DOIUrl":"https://doi.org/10.15375/zbb-2024-0110","url":null,"abstract":"\u0000 This article summarises and puts into context the limited but important case law of the European Court of Human Rights concerning bank resolution procedures, in particular under Article 6 (the right to a fair trial before an independent and impartial tribunal established by law) and Article 1 of the First Protocol (the right of property), as well as the important issue of who has standing under Article 34 to bring proceedings in the name or on behalf of an affected affected bank, its (former) management, share holders, bond holders, creditors or others affected.","PeriodicalId":509014,"journal":{"name":"Zeitschrift für Bankrecht und Bankwirtschaft","volume":"40 ","pages":""},"PeriodicalIF":0.0,"publicationDate":"2024-02-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139836137","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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