Informe_Anual_Cecabank

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Page. 35 Cecabank 2015 Annual Report
If anything marked this legislation, it was the great
cession of sovereignty stemming from the transfer of the
supervision and resolution competences of our financial
system to European authorities, which has even been
compared with the implantation of the single currency
in 2002 because of its importance.
Thus, the creation of the banking union implied the
redefinition of the competences of national authorities
(mainly the Bank of Spain and FROB but also the Spanish
securities commission, CNMV, albeit to a lesser extent)
and their integration in the new European mechanisms,
on the basis of the three pillars of the banking union:
the Single Supervisory Mechanism (SSM), the Single
Resolution Board (SRB) and the future deposit insurance
fund for Europe (EDIS). Entities will be subject to a new
global, more prospective, supervisory approach (with
the focus on corporate governance), the main exponent
of which is the SREP (Supervisory Review and Evaluation
Process), which will even address aspects related to the
entity’s strategy.
The most notable novelties in the banking union are
those related to the resolution and recovery of credit
institutions. If anything came out of the crisis, it is
the political intention of not having to restructure the
financial system at the taxpayers’ expense ever again.
To avoid this, new national and European regulations
have been passed whereby internal recapitalization
or bail-ins constitutes the basic tool in entities’
recovery or resolution processes. Thus, the bulk of the
expense is assumed by shareholders’ and creditors.
Complementing this, national resolution funds are
created which can also contribute to entities’ recovery
in the second instance and which will gradually be
mutualized in a single European fund.
Notable as regards the regulations for retail banking is
the approval of the reform of the MiFID (MiFID 2-MiFIR )
and the PRIIPS regulation (Package Retail and Insurance-
based Investments Products), which together seek to
increase investor protection levels.
Balance Sheet 2012/2015
Banking
Union Resolution Retail Fiscal
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