A Decade of the Single Resolution Mechanism: Strengthening Europe’s Banking Union

This year marks ten years since the launch of the Single Resolution Mechanism (SRM), an integral component of Europe’s Banking Union crafted in response to lessons learned from past financial crises.

Over its first decade, the SRM has transformed banking resolution in the eurozone from a theoretical ambition into a functioning, authoritative framework. This progress has been achieved through the development of resolution plans for every bank, buildup of robust loss-absorbing capacity, and the establishment of the Single Resolution Fund, now capitalized at around €80 billion. Legal certainty has been strengthened through court rulings, and the crisis management and deposit insurance (CMDI) framework has evolved despite challenges during negotiation.

Notably, the SRM’s operations have faced real-world tests, proving its effectiveness in managing bank failures without broader instability. The conversations marking the anniversary reflect on both achievements and remaining gaps: while SRM stands as a model of European integration and cooperation, further action is needed. Priorities include completing the Banking Union’s third pillar, adapting to fresh sources of financial risk—from cyber-attacks to digital assets—and ensuring that crisis readiness is not only planned but effectively operationalized and routinely tested.

The SRM’s credibility is rooted in the dedication of its staff across European institutions and national authorities, whose efforts have elevated the resilience of the financial system. As Europe faces new financial, geopolitical, and technological uncertainties, maintaining robust resolution tools and crisis preparedness remains crucial. Continued vigilance, collaboration, and a balanced regulatory approach will ensure that the Banking Union can protect depositors, foster trust, and help drive the EU’s economic growth.

This milestone not only highlights how far European banking stability has come but also underscores the ongoing need for unified efforts to strengthen financial resilience across the continent.