Revision of EU banking regulation
With the newly adopted Capital Requirements Regulation (CRR) and an amendment to the Capital Requirements Directive (CRD IV), a first part of the Basel III standard was transposed into Liechtenstein law in 2014. The banking package implements further key elements of the Basel III framework, which was essentially completed at the end of 2017, at European level through amendments to the CRR (CRR II) and CRD (CRD V). The EU banking package also changes and supplements the new resolution regime introduced in Liechtenstein in 2017. In the event of resolution, the minimum requirements for own funds and eligible liabilities (MREL) are adjusted. The new, stricter regulations increase the liabilities that could be bailed in the event of resolution (bail-in capital) and thus increase the resolution capacity of banks. This reduces the risk of having to recourse to public funds in bank resolutions, leading to a better balance between control and liability.