Press Release: Commission sets out vision for bank resolution funds

The European Commission on 26 May 2010 proposed that the European Union establishes an EU network of bank resolution funds to ensure that future bank failures are not at the cost of the taxpayer or destabilise the financial system. Following discussion at the forthcoming European Council, the European Commission will present these ideas at the G-20 Summit in Toronto on 26-27 June 2010. Such funds would form part of a broader framework aimed at preventing a future financial crisis and strengthening the financial system. The Commission believes that a way to achieve this is by introducing requirement for Member States to establish funds according to common rules into which banks are required to pay a levy. The funds would not be used for bailing out or rescuing banks, but only to ensure that a bank's failure is managed in an orderly way and does not destabilise the financial system.

• Primary Source

European Commission: Memo: MEMO/10/214: Bank Resolution Funds – Frequently Asked Questions http://europa.eu/rapid/pressReleasesAction.do?reference=MEMO/10/214&format=HTML&aged=0&language=EN&guiLanguage=en

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