Banks maintain MREL targets, shortfall minimal
The Single Resolution Board (SRB) published its MREL Dashboard for H2 2025, confirming banks continue to meet their minimum requirement for own funds and eligible liabilities (MREL) targets. The aggregate shortfall against final targets stood at a minimal EUR 0.2 billion.
MREL targets stable, compliance strong
For resolution entities, the average MREL final target, including the Combined Buffer Requirement (CBR), was equal to 27.8 percent of the Total Risk Exposure Amount (TREA).
This figure remained stable compared to H1 2025, indicating consistent adherence to resolution requirements across the banking sector.
The MREL framework ensures that banks maintain sufficient loss-absorbing capacity, allowing shareholders and creditors to bear the costs in the event of a bank failure, thereby protecting taxpayers.
The dashboard provides a comprehensive overview of the evolution of these targets, shortfalls for both external and internal MREL, and the composition of eligible instruments.
This consistent performance underscores the effectiveness of the SRB's supervisory efforts in fostering a resilient financial system.
The data, based on bank reports to the SRB, covers all entities under its remit, offering a robust picture of the resolution landscape.
The stability of the average target suggests that banks have largely adapted to the regulatory framework, integrating MREL requirements into their capital and funding strategies.
This ongoing compliance is crucial for maintaining confidence in the banking sector's ability to withstand potential crises without public funds.
Minimal shortfall, broad adherence
The total MREL shortfall against banks' final targets, including the CBR, reached an aggregate of EUR 0.2 billion, corresponding to less than 0.01 percent of TREA.
This minimal shortfall is primarily attributed to a small number of banks still operating under transitional periods to fully meet their final targets.
Crucially, all other entities within the SRB's scope continue to fully comply with their MREL requirements, demonstrating broad-based adherence across the resolution landscape.
The dashboard further elaborates on the evolution of MREL targets and shortfalls for both resolution entities (external MREL) and non-resolution entities (internal MREL).
It also details the level and composition of MREL resources for resolution entities in H2 2025, alongside recent developments in funding costs and gross issuances of MREL-eligible instruments.
Steady progress, but vigilance remains
The SRB's latest dashboard confirms a reassuring picture of MREL compliance across the euro area banking sector.
While the minimal shortfall is easily explained by transitional arrangements, it underscores the ongoing need for targeted supervision.
Sustained vigilance will be crucial to ensure full and timely adherence as all banks exit their transitional periods.