Resolution - How It Works

The Central Bank of Ireland is the national resolution authority for Ireland. In its capacity as resolution authority, the Central Bank is responsible for the orderly resolution of failing credit institutions, certain investment firms, credit unions and Central Clearing Counterparties (CCPs).

The Central Bank manages resolution funds and prepares resolution plans for these entities with the exception of CCPs as there are currently none authorised in Ireland. These plans can then be activated in the event of a failing or likely to fail determination, in accordance with the EU Bank Recovery and Resolution Directive (BRRD) (as amended by BRRD2). 

The Resolution & Crisis Management function within the Central Bank has the responsibility for day-to-day resolution matters. There is both European and Irish legislation governing these areas.

Single Resolution Mechanism

The Single Resolution Mechanism (SRM) is made up of a network of national resolution authorities and a central decision making body, the Single Resolution Board (SRB). The Central Bank works closely with the SRB, which is directly responsible for significant institutions and cross border groups in the Banking Union while the Central Bank remains directly responsible for less significant institutions, investment firms, and credit unions.

The SRB is a Brussels based independent EU agency. It is the resolution authority for the Banking Union and is responsible for the management of the Single Resolution Fund, to which all credit institutions within the Banking Union contribute.

The Central Bank's Approach to Resolution and Minimum Requirement for Own Funds and Eligible Liabilities (MREL)

The Central Bank published the first edition of its Approach to Resolution for Banks and Investment Firms in April 2019. This document:

  •  Provided an overview of the resolution framework, including the Single Resolution Mechanism system;
  • Outlined the Central Bank's general perspectives on resolution planning; and
  • Illustrated how the Central Bank would exercise its resolution and liquidation powers in a failure event.

In October 2021, the Central Bank published a second edition of this document in order to reflect domestic and EU legislative and policy developments introduced in the intervening period, particularly with regard to the Risk Reduction Measures (RRM) Package and BRRD2 (see legislation for further details).

At the same time, the Central Bank also developed the Approach to MREL publication. This document:

  • Provides an overview of the purpose of MREL and related matters in the resolution framework; and
  • Outlines the Central Bank’s powers and discretions with regards to MREL and related matters.
The Central Bank of Ireland's Approach to Resolution for Banks and Investment Firms (Second Edition) | pdf 1296 KB The Central Bank of Ireland's Approach to MREL | pdf 816 KB

See our resolution explainer also.

Industry Briefing

Resolution Industry Briefing 8 December 2021 | pdf 1544 KB Resolution Industry Briefing 30 May 2019 | pdf 1585 KB Resolution Industry Briefing 16 November 2018 | pdf 1001 KB Resolution Industry Briefing 5 February 2018 | pdf 1130 KB

Find out more about resolution at the Central Bank of Ireland