Resolution in Spain
At a national level, Law 11/2015* set up a new institutional framework in order to comply with the principles set out in the Resolution Directive to separate the supervisory and resolution functions.
The Spanish model, unique in the Banking Union, divides resolution responsibilities among three authorities:
- Two preventive resolution authorities, Bank of Spain and CNMV (Spanish Securities Market Regulator), responsible for credit institutions and investment firms during the planning stage of the resolution, which implies being the authorities in charge of data collection and preparation of resolution plans, setting the minimum requirement for eligible liabilities (the so-called MREL) and identifying and removing obstacles to resolvability.
- A single executive resolution authority, FROB, which, in addition to having advisory functions in the planning phase, is responsible for the direct exercise of resolution powers for non-significant credit institutions and investment firms. It is also in charge of implementing the resolution decisions adopted by the Single Resolution Board (SRB), the central authority of the Single Resolution Mechanism, for entities established in Spain and also exercises Spanish representation in the SRB. The FROB also manages the National Resolution Fund (NRF) and collects contributions from the Single Resolution Fund (SRF). Lastly, the FROB is the international contact and coordination authority.
Finally, in October 2022, in accordance with the provisions of article 4.1 of Regulation (EU) 2021/23 of the European Parliament and of the Council, of December 16, 2020, regarding a framework for the recovery and resolution of central counterparty entities (CCPs), CNMV was designated as the competent authority in Spain to exercise the resolution powers of the CCPs.