The President of the Council of Europe has issed a report titled: Towards a Genuine Economic and Monetary Union: Interim Report (report). The report outlines issues that require attention in moving towards a European Economic and Monetary Union. In relation to the resolution, the report noted that The European Commission has already proposed a recovery and Resolution Directive that will ensure (i) the use of best practice and superior bank resolution tools to protect taxpayers (e.g. bail in, creation of bridge banks, etc.) and (ii) consistency of national schemes to facilitate home/host resolutions and cross-border crisis management.

The national resolution funds that the directive proposes will also ensure that the cost of resolution is borne first and foremost by the private sector. In a context where supervision is effectively moved to a single supervisory mechanism, a common resolution authority with an appropriate backstop would come to be required so as to ensure that resolution decisions are taken swiftly, impartially and in the best interests of all. During the transition phase and after the establishment of an effective single supervisory mechanism, the ESM will have the possibility to recapitalise banks directly, relying on appropriate conditionality.