State Aid to Banks in the EU

Abstract

The aim of the article is to discuss how the EU legal framework concerning resolution of banks changed in the meantime after creating the Banking union and the relationship to the existing State aid rules and possible tensions of this relationship. For this purpose, the article briefly describes the process of resolution of banks according to the Banking Communication, BRRD and SRM and explains the circumstances under which the State aid rules apply. Besides that, it argues that the parallel existence of both sets of rules implies a potential conflict between the competences of the bodies that govern each of the two sets of rules. In conclusion, the article focuses on the possible implications of Brexit for this area.

Keywords: banking sector, state aid, BRRD, SRM, burden-sharing