Commission approves prolongation of orderly liquidation scheme for small Italian banks

Commission approves prolongation of orderly liquidation scheme for small Italian banks
Опубликовано: Wednesday, 26 January 2022 19:39

The scheme enables the Italian state to support the sale of assets and liabilities of a failed bank to another bank. Under the scheme, the buyer will be selected on the basis of a competitive bidding process and should viably integrate the acquired activities within one year. The shareholders and subordinated creditors of the failed banks will have to contribute to cover the losses, thus helping to minimise the need for aid. The Commission found that the Italian measure is in line with the conditions set out in the 2013 Banking Communication for orderly liquidation schemes for small banks, with the exception of the €3bn balance sheet threshold. In this respect, the Italian scheme will continue to be available to small banks (other than co-operatives) with total assets of less than €5bn.

In this respect, given the ongoing exceptional circumstances linked to the coronavirus outbreak and the safeguards against undue competition distortions that Italy has included in the scheme, the Commission will continue to accept the higher threshold of €5bn and has approved the prolongation of the scheme under EU state aid rules. This €5bn threshold is also temporarily applied in similar schemes with similar safeguards to those implemented by Italy (see in this respect the Polish resolution scheme for cooperative banks and small commercial banks). The non-confidential version of the decision will be made available under the case number SA.100262 in the state aid register on the Commission’s competition website once any confidentiality issues have been resolved.

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