Elke König, head of euro area bank resolution, to visit Bank of Lithuania
On 3–4 November the Bank of Lithuania will host Elke König, Chair of the Single Resolution Board (SRB), which coordinates the resolution of problem banks at the euro area level. For her first visit in Lithuania, Vitas Vasiliauskas, Chairman of the Board of the Bank of Lithuania, will welcome the Head of the SRB. Their discussion will centre on cooperation between the Bank of Lithuania and the SRB as well as the challenges arising in the development of one of the main pillars of the European banking union.
‘By participating in the Single Resolution Mechanism, we create a new-quality bank crisis management framework, ensuring that even in light of difficulties encountered by a commercial bank, its key functions, such as payments, would not fail, while depositor and taxpayer money remains protected,’ says Vitas Vasiliauskas, Chairman of the Board of the Bank of Lithuania.
In his assessment, planning the resolution actions ahead of time aims to mitigate the potential consequences of bank collapses and avoid the impairment of the bank under resolution.
The Bank of Lithuania’s experience, gained in solving problems in the banking sector, will be discussed during the meeting between V. Vasiliauskas and E. König. They will also discuss current issues, the SRB’s plans for the resolution of Europe’s largest banks, as well as the principles for the cooperation between the Bank of Lithuania and the SRB in coming years.
During the visit, E. König will also meet with the employees of the Bank of Lithuania who are responsible for the implementation of the resolution function, and with the representatives of banks operating in Lithuania. Meeting participants also plan to discuss relevant issues of the Lithuanian and European banking sector, assess the practical aspects of Lithuania’s participation in the Single Resolution Mechanism and pending organisational challenges.
Once Lithuania joined the banking union and began activities in the SRB last year, it also became a member of the SRB plenary sessions, which deal with key issues of euro area bank resolution. The resolution planning for the three largest banks in Lithuania — AB SEB bankas, „Swedbank“, AB, and AB DNB bankas — as well as AB „Citadele“, operating within the banking union, was taken over by the SRB, which also relies on the Bank of Lithuania employees and their experience in performing its daily functions.