How they work
Ex-ante contributions are payments that credit institutions and certain investment firms in the Banking Union make in advance to build up the Single Resolution Fund. Rather than raising money only after a failure, the framework accumulates resources during normal times so that the Fund is available when a resolution requires financing. Contributions are calculated annually and collected by national resolution authorities on behalf of the Single Resolution Board.
Each institution's contribution has two parts. A flat, or basic, component is proportionate to the institution's liabilities, excluding own funds and covered deposits, relative to the aggregate liabilities of all institutions in the participating Member States. This basic amount is then adjusted for the institution's risk profile, so that riskier banks pay more for the same size of balance sheet. Smaller institutions with limited liabilities may pay a lump-sum contribution under a simplified regime.
Target level and build-up
The Fund is designed to reach a target level of at least 1% of the amount of covered deposits of all authorised credit institutions in the participating Member States. The framework set an initial build-up period over which contributions were raised each year to reach that target. Once the target is attained, contributions can pause, but they resume if the Fund is later drawn down or if covered deposits grow, so that the target continues to be met over time.
A portion of the annual contribution may be met through irrevocable payment commitments backed by collateral, rather than cash, within limits set by the framework.
Legal basis
The Single Resolution Fund and its contributions are governed by the Single Resolution Mechanism Regulation (SRMR), Arts. 67 to 79. The target level is set in Art. 69, and the calculation and raising of ex-ante contributions is set in Art. 70. These sit alongside the delegated and implementing acts that specify the detailed contribution methodology. The Fund complements the resolution financing arrangements established at Member State level under the Bank Recovery and Resolution Directive (BRRD).
Practical relevance
For banks, ex-ante contributions are a recurring cost that depends on both balance-sheet size and risk profile, giving institutions an incentive to reduce risk and to hold covered deposits and own funds, which are excluded from the contribution base. For the resolution framework, the accumulated Fund is a mutualised industry-financed resource that can support resolution — for example through guarantees, loans or the purchase of assets — after shareholders and creditors have absorbed losses through bail-in and once the relevant access conditions are met. If the pre-funded resources prove insufficient, the Fund can raise ex-post contributions and, ultimately, draw on the common backstop.