Directive (EU) 2019/879 amending Directive 2014/59/EU as regards the loss-absorbing and recapitalisation capacity of credit institutions and investment firms

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Publication Date 07/06/2019
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Directive of the European Parliament and of the Council of 20 May 2019 amending Directive 2014/59/EU (the Bank Recovery and Resolution Directive).

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In November 2015, the Financial Stability Board published the Total Loss-Absorbing Capacity (TLAC) Term Sheet (‘the TLAC standard’), which was endorsed by the G20 in November 2015. The objective of the TLAC standard is to ensure that global systemically important banks, referred to as global systemically important institutions in the Union framework, have the loss-absorbing and recapitalisation capacity necessary to help ensure that in, and immediately following, a resolution, those institutions can continue to perform critical functions without putting taxpayers' funds, that is public funds or financial stability at risk.

In its Communication of 24 November 2015, ‘Towards the completion of the Banking Union’, the Commission committed itself to bringing forward a legislative proposal by the end of 2016 that would enable the TLAC standard to be implemented in Union law by the internationally agreed deadline of 2019.

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EUR-Lex: COM(2016)852: Proposal for a Directive amending Directive 2014/59/EU on loss-absorbing and recapitalisation capacity of credit institutions and investment firms
EUR-Lex: SWD(2016)377: Impact assessment accompanying COM(2016)852
EUR-Lex: SWD(2016)378: Executive summary of the impact assessment accompanying COM(2016)852

ESO Records
EU banking reform: Strong banks to support growth and restore confidence
Loss absorbing capacity in the Banking Union: TLAC implementation and MREL review

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