The GFSC is the appointed Resolution Authority (RA) for Gibraltar. The powers of the GFSC as RA are delegated to the Financial Services Resolution and Compensation Committee (the FSRCC), which was established in 2016.
The FSRCC is responsible for resolution planning for Credit Institutions and Investment Firms as well as decision-making relating to the reorganisation of institutions experiencing financial difficulties.
The FSRCC is operationally independent from the supervisory function of the GFSC, with the Resolution and Compensation Unit carrying out its day to day functions and reporting directly to the Committee.
The key resolution objectives of the RA are to:
- ensure the continuity of critical functions of BRRD firms where appropriate
- avoid a significant adverse effect on the financial system, in particular by preventing contagion, including to market infrastructures, and by maintaining market discipline;
- protect public funds by minimising reliance on extraordinary public financial support;
- protect depositors covered by Directive 2014/49/EU and investors covered by Directive 97/9/EC; and
- protect client funds and client assets.
In addition, the FSRCC will continue to add important elements to its role of ensuring the stability of the Gibraltar financial market, the protection of clients and the implementation of and compliance with recognised international standards.
Separately, the FSRCC is also the authority responsible for the Deposit Guarantee Scheme in Gibraltar. It manages the tasks of the Deposit Guarantee Scheme, collects deposit guarantee contributions and decides on the Deposit Guarantee Fund’s payment liability. For further detail, please see www.gdgb.gi
The FSRCC manages both the Resolution and Deposit Guarantee Ex-Ante Funds which are financed by contributions from credit institutions and investment firms where appropriate. These funds are held on trust and can only be used for the specified purposes intended.
RCU Bank Resolution Seminar Charting the Course for Gibraltar Banks