Implementation and First Application of the BRRD in Italy

Italy has recently adopted two Legislative Decrees (No. 180 and No. 181 of 2015) aimed at implementing the EU Bank recovery and resolution directive (“BRRD”).

The first decree (the “Resolution Decree”) applies to banks and banking groups and primarily implements the BRRD provisions related to resolution, while the second decree (the “Amending Decree” and, together with the Resolution Decree, the “Decrees”) amends relevant provisions of the Italian Banking Act and the Italian Securities Act in order to implement the BRRD provisions on recovery plans and to make additional changes required by the new resolution regime. The Amending Decree also regulates the resolution of Italian investment firms that are not part of a banking group. While the Decrees generally mirror the text of the BRRD, there are several provisions that go beyond the mere transposition of the directive.

Shortly after the publication of the Decrees, the Bank of Italy and the Government took the first resolution actions under the new regime. In this memorandum, following a brief report on this first application of the Decrees, we summarize a few salient aspects of the Italian implementation of the directive.