The European Commission on Wednesday approved Croatia's bank resolution scheme, to be used for small banks with total assets below 1.5 billion euros if found to be in distress by the competent national authorities.
"The approval of the scheme is to facilitate the work of the Croatian resolution authorities, should a concrete case and need arise for it. The Commission found the scheme to be compatible with the state aid rules on banking applicable since 2013 and related EU law. In cases where a very small bank is in serious difficulties, this type of scheme allows the prior authorisation of aid, enabling the national authorities to carry out an orderly resolution of that bank," the Commission said in a statement.
"The resolution scheme would use the tools available within the framework of the Bank Recovery and Resolution Directive (BRRD), as implemented in Croatian law. In particular, as required by the state aid rules, any aid would be limited to the minimum necessary, with the provisions of the BRRD applicable, to facilitate an orderly exit of a failing bank from the market. The authorisation of aid under the scheme is granted for six months from today and can be prolonged following a report by the Member State and an assessment by the Commission," the statement said.