Publication

This commentary looks at the basic elements of the Single Resolution Mechanism (SRM) agreed upon in 2013 by the finance ministers of the eurozone to deal with banks in crisis. The author argues that although the Mechanism leaves as many problems unaddressed as it resolves, it is a step in the right direction. Furthermore, he also says that its end result is likely to be quite strong as it establishes a key innovation: a fund that effectively mutualizes much of the risk resulting from bank failures.