Bank Recovery and Resolution Directive of the European Union

No bail-in for creditors to EAA in case of restructuring or resolution

Due to the variety of resolution institutions under different national jurisdictions the analysis of potential future risks for investors has become increasingly complex.

In the context of recent developments in Europe this has raised the question whether the German winding-up agencies –thus EAA as well- are affected by the regulations of the 'Bank Recovery and Resolution Directive' (BRRD) respectively its implementation into national law, i.e. the German law on 'Restructuring and Resolution of Institutions and Financial Groups' (SAG), implemented 1 January 2015.

EAA has obtained an explicit assessment to this question by an independent legally qualified party. The attached legal opinion of the internationally renowned law firm Hogan Lovells International LLP provides evidence that the legal character of the German winding-up agency does exclude it from the scope of entities subject to regulations of the SAG. Hence, the potentially severe consequences for investors do not apply in the case of EAA’s restructuring or resolution.

Note: the download „Legal Opinion BRRD“ refers to the Financial Market Stabilisation Fund Act (FMStFG). The latter has been renamed Stabilisation Fund Act (FStG) by Art. 2 of the law, dated 10.07.2020, effective from 17.07.2020.