The Single Resolution Fund (SRF) reached its planned target level by the end of 2023. The target level is at least one per cent of covered deposits held in the banks authorised in all the Member States participating in the banking union, which totalled about EUR 75 billion according to the data published in December 2023. The increase in the amount of deposits to be covered during 2023 was less than predicted. The holdings of the fund, consisting of cash, invested assets and payment commitments, totalled approximately EUR 78 billion in December 2023. The amount includes investment income.
Reaching the target level means that in 2024 the Single Resolution Board (SRB) will not collect EU stability contributions from banks. From now on, SRB will continue its annual data collection and use it to verify annually whether the amount of assets in the fund has remained at its target level. If this is not so, SRB will collect stability contributions from banks in order to reach the target level.
Since 2016, the SRF fund has been generated with stability contributions of institutions in the banking union. The fund can be used in the resolution of an institution after other financing methods have been exhausted. That way it contributes to the availability of resolution tools and ensures that the costs incurred from failing banks are not borne by taxpayers.
Other crisis funds will also need to reach the target levels set for them in the near future. The target level of the national Resolution Fund must be reached by the end of 2024. Therefore, in 2024 the Financial Stability Authority will collect national stability contributions from investment firms with an obligation to pay in the normal way. The target level of the Deposit Guarantee Fund must be reached by 3 July 2024 at the latest. Therefore, deposit guarantee contributions will also be collected from banks into the national Deposit Guarantee Fund in spring 2024.
More information: Kristiina Tuomikoski, Resolution Expert (vakausmaksut(at)rvv.fi).
SRB's press release: Single Resolution Fund: no expected contribution in 2024 as target level reached.
Further information on resolution funds is available on the FFSA website.
