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Bank Failure and Resolution in the EU

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Bank Failure and Resolution in the EU Synopsis

Financial crises are recurring events that expose weaknesses in risk management, regulation, and supervision. The 2008 financial crisis demonstrated the systemic nature of banking crises and the high cost of taxpayer-funded bailouts, leading policymakers to reform crisis-management frameworks. In the European Union (EU), these reforms included the Banking Union and the Bank Recovery and Resolution Directive (BRRD), which aimed to reduce reliance on public funds and address the "Too Big to Fail" (TBTF) problem. However, the framework has proven less effective for small and medium-sized banks, and recent stress episodes have revealed some inefficiencies, prompting further reforms through the Crisis Management and Deposit Insurance (CMDI) directive.

This book examines lessons from past bank failures and evaluates the effectiveness of the EU's post-2008 resolution regime. It combines conceptual analyses with empirical case studies from Europe and the United States, exploring systemic risk, the TBTF dilemma, and the practical challenges of resolution. The cases highlight successes, controversies, and persistent weaknesses, such as liquidity provision, deposit-insurance fragmentation, and the treatment of smaller banks. Overall, the volume argues that although significant progress has been made, bank resolution remains a complex political and institutional challenge, and further reforms are needed to ensure a credible and effective framework for both large and smaller banks.

The book is aimed at scholars, researchers and advanced students in the banking, finance and regulatory economics community, as well as regulators, policy makers and professionals working in central banks, supervision authorities, resolution agencies and deposit guarantee schemes.

About This Edition

ISBN: 9781041219507
Publication date:
Author: Sebastian Royo, Ewa Miklaszewska, Giovanni Ferri
Publisher: Routledge an imprint of Taylor & Francis
Format: Hardback
Pagination: 266 pages
Series: Routledge International Studies in Money and Banking
Genres: Macroeconomics
Banking
Credit and credit institutions
Banking law
Political economy

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