A Note on the Adequacy of the EU Scheme for Bank Recovery, Resolution and Deposit Insurance in Spain

Journal of Banking Regulation, 2016, 17, 4, 332–337

8 Pages Posted: 28 Dec 2014 Last revised: 6 May 2018

See all articles by Pilar Gómez-Fernández-Aguado

Pilar Gómez-Fernández-Aguado

University of Jaén

Antonio Partal-Ureña

University of Jaén

Antonio Trujillo‐Ponce

Universidad Pablo de Olavide - Department of Financial Economics & Accounting

Date Written: November 11, 2015

Abstract

This paper analyzes whether the funds set by the recent EU directives on bank resolution and deposit insurance to create a safer and sounder financial sector (i.e., 1% and 0.8% of covered deposits, respectively) are adequate to cover unexpected losses for the Spanish banking system. By applying a framework based on the foundation internal ratings-based (FIRB) approach established in Basel Capital Accords, we find that the fixed target levels proposed by the EU bank rules would not ensure the highest credit quality for a resolution and deposit insurance Fund (BRDIF) in Spain. Nevertheless, these resources would be sufficient to ensure a good solvency level for the Fund, equivalent to an AA S&P rating in 2013.

Keywords: deposit insurance system; European banking system; capital adequacy; internal ratings-based approach

JEL Classification: G21; G22; G28

Suggested Citation

Gómez-Fernández-Aguado, Pilar and Partal-Ureña, Antonio and Trujillo-Ponce, Antonio, A Note on the Adequacy of the EU Scheme for Bank Recovery, Resolution and Deposit Insurance in Spain (November 11, 2015). Journal of Banking Regulation, 2016, 17, 4, 332–337, Available at SSRN: https://ssrn.com/abstract=2543231 or http://dx.doi.org/10.2139/ssrn.2543231

Pilar Gómez-Fernández-Aguado

University of Jaén ( email )

23071 Jaen
Spain

Antonio Partal-Ureña

University of Jaén ( email )

23071 Jaen
Spain

Antonio Trujillo-Ponce (Contact Author)

Universidad Pablo de Olavide - Department of Financial Economics & Accounting ( email )

Ctra. Utrera, Km.1
Sevilla, 41013
Spain

HOME PAGE: http://https://www.upo.es/investiga/banef/

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