On 17-19 October 2022, the Working Group on Bank Insolvency, chaired by Governing Council member Stefania Bariatti, met for its third session. The meeting was hosted by the Single Resolution Board (SRB) in Brussels, and was attended by 10 Working Group members and 31 observers, including representatives from international and transnational organisations, central banks, deposit insurance corporations and resolution authorities, as well as members of the Financial Stability Institute (FSI) and the UNIDROIT Secretariat. Attendance was both physical and online.
The Working Group commenced with an update on the intersessional work and developments since the second Working Group session, which included work in three Subgroups and the conduct of a comprehensive stock-taking exercise to collect information on bank liquidation regimes worldwide. The Working Group then elaborated on the proposed format and target audience of the future instrument; the scope of special bank liquidation regimes and relevant definitions; objectives; effective institutional arrangements; procedural and organisational aspects of the liquidation process; preparatory actions and the grounds for commencing bank liquidation proceedings; tools and powers; funding; matters of creditor hierarchy; the treatment of financial contracts; specificities for banking groups; and issues relating to cross-border scenarios.
The Working Group also addressed the organisation of future work, which included establishing a Drafting Committee, to be tasked with the preparation of a first draft of the Guide based on the discussions and input collected so far.
The next session of the Working Group is scheduled for 29-31 March 2023 and will be hosted by the FSI in Basel.
Further information on the UNIDROIT project on Bank Insolvency is available on the UNIDROIT website: https://www.unidroit.org/work-in-progress/bank-insolvency/.