Laboureix urges stronger liquidity backstops for bank resolution
Single Resolution Board (SRB) Chair Dominique Laboureix called for credible liquidity backstops and closer crisis coordination. Only four of 19 jurisdictions assessed by the Financial Stability Board (FSB) fully met its resolution funding standard.
Funding must survive the crisis
Speaking in Berlin at the International Association of Deposit Insurers (IADI) conference, Laboureix said the EU Banking Union was not fully compliant with Key Attribute 6. Banks need liquidity to maintain payments during resolution, not just loss allocation and recapitalisation.
He called for backstops with sufficient scale and speed, clear responsibilities, safeguards and loss-recovery plans.
European Commission work raises a possible deposit insurance role for the Single Resolution Fund for the largest banks and liquidity support to national deposit guarantee schemes.
He supported greater integration, subject to clear design.
IADI Principles 17 and 18 cover safety-net coordination and cross-border cooperation; the SRB is strengthening ties with deposit insurers.
Shared providers widen the perimeter
Laboureix urged authorities to track critical services beyond banks, including stablecoins, tokenised deposits, deposit-placement platforms and sweep arrangements.
He cited the July 2024 CrowdStrike outage and an October 20 Google Cloud failure in London affecting Revolut and other financial firms.
Debt, leverage and liquidity mismatches remain concerns: March 2020 market stress, Archegos in 2021 and the September 2022 UK gilt disruption illustrate transmission beyond banks.
Operational failures can also compromise data needed for resolution decisions.
Prevention is not readiness
Laboureix's central distinction is between preventing disruption and remaining able to act when prevention fails.
A resolution strategy needs usable data, operational continuity and liquidity to work under stress.
His priority is implementing existing standards and coordinating authorities, not discarding the framework.