The Crisis Management of Smaller Banks: Perspectives of Reform

European Company and Financial Law Review, 2023, 660–691

25 Pages Posted: 20 Nov 2023 Last revised: 11 Dec 2023

See all articles by Irene Mecatti

Irene Mecatti

Law Department- Siena University; European Banking Institute

Multiple version iconThere are 2 versions of this paper

Date Written: October 15, 2023


The current common framework for bank crisis management and national deposit guarantee schemes (CMDI) is tailored for banks which are considered too big (or too complex) to fail. Smaller banks are de facto excluded from the application of resolution, even though they are obliged to contribute to its functioning. In practice, not even the size element has been decisive and both the crises of significant and less significant institutions have been managed at the national level instead of within the perimeter and conditions foreseen by the BRRD. The consequent and persistent fragmentation in the European financial market requires that the dichotomy between resolution and liquidation be overcome and that the scope of resolution also include smaller banks. The paper analyses the main reforms needed to achieve this goal, including the European Commission's recent proposal to revise the CMDI.

Keywords: banking union, CMDI reform, resolution, liquidation, deposit guaratee schemes

JEL Classification: 01, G18, G21, G28, K22, K23

Suggested Citation

Mecatti, Irene, The Crisis Management of Smaller Banks: Perspectives of Reform (October 15, 2023). European Company and Financial Law Review, 2023, 660–691, Available at SSRN: or

Irene Mecatti (Contact Author)

Law Department- Siena University ( email )

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European Banking Institute ( email )

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