The Economic and Monetary Affairs Committee in the European Parliament commented on one of the three key building blocks for establishing an EU banking union that its bank crisis resolution plans focus too closely on individual troubled banks, and must do more to address crises that could infect an entire banking sector.

MEPs commented on a draft legislation tabled in the Economic and Monetary Affairs Committee in the European Parliament that the European Commission's bank crisis resolution plans focus too closely on individual troubled banks, and must do more to address crises that could infect an entire banking sector. This draft legislation is one of the three key building blocks for establishing an EU banking union. In September 2012, the Commission proposed a banking union with stronger supervisory powers for the European Central Bank.

The responsible for the report, the MEP Gunnar Hokmark also highlighted that the next priority would be for the legislation to distinguish clearly between the final stage at which a bank is still run by its owners and that at which it is taken into public control, as this clarity would be essential to proper crisis resolution. His text also offers a definition of "systemic crisis" and recommends methods for allowing public budgets to also be called upon should public intervention be needed to avoid much greater costs.

The text debated at the ECON Committee would also introduce rules to ensure that it is always clear which entity is running a bank. The rule changes aim to clarify the fact that so long as a bank is a going concern, it is its shareholders who are responsible. On the other hand, once resolution is necessary, the relevant public authority should have full control, according to Mr Hokmark text.