SRB Liquidity in Resolution: The 2026 Guidance Update

ByOfficer

Last updated: May 2026

If your bank has spent the past two years building out liquidity-in-resolution capabilities under the SRB’s Expectations for Banks, this consultation will not ask you to start over. But it will ask you to revisit several assumptions you thought were settled. On 11 May 2026, the Single Resolution Board opened a public consultation on a consolidated and updated version of its operational guidance for banks on liquidity and funding in resolution. The consultation runs until 6 July 2026. The document consolidates three separate guidance papers into one, clarifies expectations that caused divergent interpretations across banks, and incorporates lessons the SRB drew from practical resolution planning cycles and the 2023 banking turmoil.

What makes this update operationally significant is not the introduction of new deliverables. The SRB explicitly states the guidance does not contemplate new deliverables. Instead, the changes tighten definitions, broaden the scope of entities that qualify as Key Liquidity Entities, add precision to scenario parameters, and introduce new collateral-related expectations. For resolution planning teams, treasury, and regulatory reporting functions, the question is whether your current framework still meets the bar once these clarifications take effect.

Related reading: MREL reporting requirements for EU banks

What the Consultation Covers and Why It Matters

The SRB’s original liquidity-in-resolution expectations sit under three principles in the Expectations for Banks (EfB) document: principle 3.1 on estimating liquidity and funding needs, principle 3.2 on measuring and reporting the liquidity situation, and principle 3.3 on identifying and mobilising collateral. Between April 2021 and June 2023, the SRB published three separate operational guidance documents covering these principles. The phase-in implementation period ended in December 2023.

This consultation consolidates all three into a single document. The Table of Equivalence in Annex I maps each paragraph from the old guidance to the new text. That table is your starting point for any gap analysis. It flags the importance level of each change (minor, medium) and explains what shifted.

The four headline areas of change, as stated by the SRB, are: (i) the scope of Key Liquidity Entities and standard identification methods, (ii) methodological assumptions for estimating liquidity needs, (iii) governance expectations on the liquidity situation, and (iv) collateral-related expectations. None of these are cosmetic. I have seen banks interpret KLE identification narrowly enough that the updated scope alone could force a re-assessment of which entities fall inside the perimeter.

Key Liquidity Entities: A Broader Net

The biggest operational change sits in Section 2.1 of the consultation document. The updated guidance broadens the scope of entities that could be identified as KLEs. Banks are now expected to assess a wider set of entity types beyond Relevant Legal Entities (identified per the criteria in Article 1 of Commission Implementing Regulation (EU) 2025/2303) and Material Legal Entities (identified per the criteria in Article 7(2) of Commission Delegated Regulation 2016/1075).

The expanded list of entity types that banks must consider now explicitly includes: significant branches (especially outside the Euro Area or Banking Union), SPVs used for securitisation or covered bond issuances, subsidiaries that provide access to strategically important markets or affect the liquidity position of any RLE or MLE, insurance and re-insurance undertakings, leasing and factoring companies, pension fund management companies, asset management companies, broker-dealer entities, custodian and depository institutions, and deposit platforms that allow customers to deposit funds in certificates of deposit or savings accounts at banks.

That last item is new and directly relevant. If your group operates or uses a deposit platform, it now falls within the KLE assessment perimeter. The common error I expect here: teams treating this list as a checklist of entities that must be KLEs. It is not. It is a list of entity types that must be assessed against the four identification conditions. An entity qualifies as a KLE if it provides liquidity to resolution group entities, depends on group liquidity, performs liquidity management functions for the group, or may bring financial support to a distressed entity under written agreements.

The guidance also introduces a new KLE identification template in Annex II. Banks are not required to use this template, but the criteria in it are designed to standardise the assessment process. The KLE identification sheet covers institutions, funding structure, collateral and exposures information based on standardised metrics. KLD identification sits on a separate sheet of the same Annex II workbook, with adequate time horizons for the resolution phases.

Derogation and Sub-Grouping

Where banks consider that an RLE or MLE does not itself constitute a KLE, or where the corporate structure justifies grouping certain KLEs (the guidance mentions cooperative banks as an example), banks can request a derogation from the IRT. This must be justified in advance and discussed with the relevant Internal Resolution Team before finalisation. The key constraint: the bank must demonstrate that excluding or sub-grouping entities does not impact the liquidity management and position of the group in resolution.

Mortgage credit institutions referred to in Article 12b of Regulation (EU) 806/2014 are also expected to be included in the KLE identification process. Where banks identify such institutions as KLEs, IRTs may grant a tailored implementation of the expectations.

Key Liquidity Drivers: What Teams Often Underestimate

KLDs remain defined as factors that might trigger a substantial deterioration of the liquidity position in resolution. The identification process must be both qualitative and quantitative. The updated guidance emphasises that banks should not rely solely on their ILAAP or recovery plan risk identification. Risks identified for supervisory purposes may not capture resolution dynamics, may be dramatically accentuated in resolution, or may change entirely.

The operational trap here: banks that treat their existing ILAAP liquidity stress scenarios as sufficient for resolution planning. The SRB is explicit that ILAAP and recovery plan risks are a starting point, not an endpoint. Banks must further assess risks specific to resolution and risks that are extreme. This distinction is not theoretical. During the 2023 banking turmoil, deposit outflow rates in some cases exceeded what standard stress testing assumed, precisely because the scenarios were not calibrated to resolution-specific dynamics.

Banks are expected to assess KLDs at the level of the resolution group and at the level of each KLE, over different time horizons. Each KLD must be scored for relative importance per time bracket. The period closer to the resolution weekend should use weekly time brackets; other periods may use monthly brackets. The assessment must be documented and submitted to the IRT with a methodology description, a narrative on KLD evolution over time, and an impact analysis in material currencies.

The non-exhaustive list of KLDs includes deposit outflows by type (stable vs non-stable, DGS-covered or not, operational vs non-operational), drawdowns on committed facilities, FMI liquidity and collateral requirements, loss of access to wholesale funding, and contractual triggers linked to rating downgrades. If your current KLD framework does not break deposits down to this level of granularity, the updated guidance will surface that gap.

Scenario Design and Methodological Assumptions

Section 2.3 refines the scenario expectations. Banks must apply their estimation methodologies to a minimum of two resolution scenarios: a slow-moving and a fast-moving scenario. The parameters are prescriptive:

In a slow-moving scenario, the bank enters resolution no less than 12 months after the start of the crisis. In a fast-moving scenario, it enters resolution no more than one month after the start. This is a reduction from the previous three-month assumption, reflecting lessons learnt from the 2023 banking turmoil, when liquidity outflows proved faster than previously assumed. Banks with existing fast-moving calibrations built on the three-month assumption will need to re-tune. The slow-moving scenario allows the bank to implement structural recovery options. The fast-moving scenario limits the bank to recovery options that take less than one month to execute.

Both scenarios must simulate the liquidity position of each KLE across three resolution phases: the run-up to resolution, the resolution day or weekend, and the stabilisation phase. The stabilisation phase must cover at least six months post-resolution for bail-in strategies, or at least one month for transfer tools (sale of business).

What Gets Wrong in Practice

Three common errors in scenario design that this guidance now makes harder to sustain:

First, banks assuming that post-resolution access to unsecured debt markets recovers quickly. The guidance expects banks to assume the institution remains under stress for some time after resolution, with limited access to unsecured markets. Rating upgrades during the stabilisation phase should be considered “only exceptionally.”

Second, the FOLTF trigger design. Banks are expected to design a plausible failure scenario where liquidity, not solvency alone, is a key element of the trigger. The trigger is at the bank’s discretion, but it must align with the criteria in Article 18(4) SRMR and the EBA’s FOLTF guidelines (EBA/GL/2015/07). Banks that default to a solvency-driven trigger and treat liquidity as a secondary consequence will need to revisit their approach.

Third, the run-off rates and haircuts. These must be calibrated specifically for resolution conditions, not imported from recovery planning or supervisory stress tests without adjustment. The guidance expects calibration to be “internally validated, documented with a rationale and reviewed at least annually or after significant market events.”

Intraday Liquidity in Resolution

The guidance now explicitly expects banks to estimate key intraday liquidity metrics across resolution phases. This is aligned with BCBS Standard 248 and Article 86 CRD. At minimum, banks should use their existing business-as-usual intraday metrics: daily maximum intraday liquidity usage, available intraday liquidity at start of day, total gross daily payments made and received, and intraday credit relative to Tier 1 capital. Banks must define which liquidity sources are suitable for intraday needs in resolution, prioritise them across resolution phases, and consider the transferability of intraday liquidity between legal entities.

Governance and Reporting Capabilities

Section 3 of the consultation tightens governance expectations around the measurement and reporting of liquidity in resolution. The core expectation is alignment with BCBS Standard 239 (risk data aggregation), adapted for resolution specificities.

Banks must demonstrate they can produce the SRB’s standardised data set at the level of the resolution group and at individual KLE level, in all material currencies, at high frequency (more than once a day), and at short notice (within 24 hours). The governance structure must document clear lines of responsibility, escalation processes, teams and committees involved, and the roles of individual staff where possible. Banks must also assess what happens to these capabilities if resolution tools fragment the group structure.

The reporting obligation is not new. What is new is the emphasis on internal control frameworks and quality assurance for the data. The SRB expects banks to demonstrate that data reported for resolution liquidity purposes is consistent with other supervisory deliverables. If your liquidity data for resolution planning comes from a different source system or uses different definitions than your COREP ALMM submissions, that inconsistency is now a documented expectation gap.

The Liquidity Data Collection Exercise

The SRB’s liquidity data collection exercise is explicitly framed as a capability test, not a pass/fail assessment of the bank’s liquidity position. The focus is whether the bank can produce the standardised data at the required frequency and granularity. The reporting channel is currently CASPER. Banks must submit in accordance with reporting instructions provided ahead of each exercise, and a Q&A process is in place for questions.

Where teams get this wrong: treating the data collection exercise as a one-off compliance task rather than an ongoing operational capability. The guidance expects banks to maintain these capabilities continuously, not spin them up only when the SRB requests a submission.

Collateral Identification and Mobilisation

Section 4 updates expectations on collateral in resolution. The starting assumption is that at the point of resolution, a large part of the bank’s liquid assets will already be encumbered. The bank will need to mobilise less liquid and lower-quality assets for secured funding through private markets, central bank facilities, the Single Resolution Fund, or other public sector backstops.

The SRB has developed a collateral policy under the Common Backstop framework. Under this policy, the SRF will provide liquidity on a fully collateralised basis to the extent that collateral is available and that the mobilisation is practical in light of the circumstances at resolution. Almost all asset classes are eligible, with haircuts applied according to the SRB’s internal risk framework. An independent valuation will be performed.

Banks must describe their collateral governance and management framework for resolution, including: the level of centralisation, decision-making bodies, monitoring metrics and early warning indicators, asset encumbrance policy and the capacity to monitor encumbrance at KLE and resolution group level, and identified management actions to release encumbered collateral.

The updated guidance introduces Annex III, a collateral template for time-to-mobilise estimates. This replaces earlier paragraph-level expectations with a standardised format aligned with the 2025 Resolution Planning Cycle (RPC). Banks must estimate the time needed to mobilise different asset classes and reflect this in their liquidity estimation methodologies. The common error: teams providing time-to-mobilise estimates at the asset class level without accounting for legal obstacles (consent of debtor, non-recognition of governing law) or operational obstacles (system access, custodian processes) that can delay mobilisation significantly.

Correspondent Central Banking Model

The updated guidance includes new information on the CCBM (Correspondent Central Banking Model) for cross-border collateral mobilisation within the Eurosystem. This is relevant for banks that hold eligible assets in one national central bank’s books but need to pledge them to another. If your collateral management framework does not account for CCBM processes and timelines, this is a gap to address.

What This Means for Reporting and Process Teams

The consultation does not create new reporting templates or regulatory returns. But it changes the substance behind several deliverables that resolution planning teams already produce. Here is where reporting, finance, and treasury teams should focus their review:

First, the KLE identification. If your bank previously limited KLEs to RLEs and MLEs, re-run the assessment against the expanded entity list. Check whether SPVs, deposit platforms, or branches in third countries now fall inside the perimeter. Use the Annex II template as a crosscheck even if you do not adopt it formally.

Second, the KLD scoring. Verify that your KLD identification process distinguishes resolution-specific risks from ILAAP risks. Verify the time brackets are granular enough, especially for the period around the resolution weekend.

Third, scenario calibration. Confirm that the slow-moving and fast-moving scenarios meet the 12-month and 1-month thresholds respectively. Check that post-resolution forecasts cover at least six months for bail-in strategies. Verify that run-off rates and haircuts are documented, validated, and reviewed annually.

Fourth, data capabilities. Assess whether you can produce the SRB’s standardised data set at resolution group and KLE level, in material currencies, at intraday frequency, within 24 hours of a request. If any part of this chain depends on manual processes, that is a vulnerability.

Fifth, collateral mobilisation. Update your time-to-mobilise estimates using the Annex III template. Map legal and operational obstacles explicitly, not just at asset class level but at instrument level where the guidance requires it.

Sixth, MPE strategy. Banks under a Multiple Point of Entry strategy may request a tailored approach to the implementation of these expectations across KLE assessment (paragraph 12), liquidity estimation at resolution group level (paragraph 40), and MIS capabilities (paragraph 90). MPE resolution groups are expected to be capable of managing liquidity and collateral independently, with no reliance on other resolution groups.

Legal Basis and Context

The guidance operates under the SRB’s mandate to ensure resolvability of banks within its direct remit under Article 7 of the Single Resolution Mechanism Regulation (SRMR). It is not legally binding, and the SRB’s disclaimer states it does not substitute legal requirements. However, in practice, IRT assessments of resolvability draw directly on compliance with these expectations. Non-compliance will surface in resolution planning feedback and could affect the resolvability assessment.

The guidance applies to banks where the SRB has concluded that resolution (not liquidation) is the preferred strategy. Subsidiaries of banking groups established outside the Banking Union with an SPE preferred resolution strategy must also comply. The guidance does not cover testing and operationalisation expectations (EfB principle 1.4) or on-site inspections under Article 36 SRMR.

The updated CMDI framework is also relevant context. Regulation (EU) 2026/808 amending the SRMR entered into force on 10 May 2026 and applies from 11 May 2028, with certain SRM institutional provisions taking effect from 11 June 2026. While the liquidity guidance itself predates the CMDI application date, banks should monitor how revised SRMR provisions may interact with resolution planning expectations as the CMDI framework takes effect.

Frequently Asked Questions

Does the updated guidance introduce new deliverables for banks?

No. The SRB explicitly states the guidance does not contemplate new deliverables. The changes are targeted amendments to existing expectations, consolidation of three prior guidance documents into one, and clarification of wording that previously caused divergent interpretations.

When does the consultation close and when will the final guidance apply?

The consultation runs until 6 July 2026. The SRB has not published a specific application date for the final guidance. Banks should monitor SRB communications for the finalised document and any implementation timeline.

Which entity types are now included in the KLE assessment scope?

The expanded scope includes RLEs, MLEs, significant branches, SPVs, subsidiaries providing access to strategically important markets, insurance and re-insurance undertakings, leasing and factoring companies, pension fund management companies, asset management companies, broker-dealer entities, custodian and depository institutions, and deposit platforms. All must be assessed against the four KLE identification conditions, not automatically designated as KLEs.

How does this guidance interact with the ILAAP?

The SRB expects banks to use ILAAP risk identification as a starting point for KLD identification but not as the endpoint. Resolution-specific risks may not be captured, may be accentuated, or may change entirely in resolution. Banks must separately assess and document risks specific to resolution dynamics.

What are the two scenario types banks must model?

A slow-moving scenario (bank enters resolution at least 12 months after the crisis begins) and a fast-moving scenario (resolution within one month). Both must cover the run-up, resolution weekend, and stabilisation phase. Post-resolution forecasts must cover at least six months for bail-in, at least one month for transfer tools.

Is the liquidity data collection exercise a pass/fail assessment?

No. The SRB frames it as a capability test focused on whether the bank can produce the standardised data set at the required frequency and granularity. The focus is on governance arrangements and MIS capabilities, not on the absolute liquidity position at the time of reporting.

What changed on collateral expectations?

The guidance introduces Annex III, a standardised collateral template for time-to-mobilise estimates. It also adds expectations on the CCBM for cross-border collateral mobilisation within the Eurosystem. Banks must now map legal and operational obstacles to collateral mobilisation at a more granular level than previously expected.

Does the guidance apply to banks in liquidation?

No. It applies only to banks within the SRB’s direct remit where resolution (not liquidation under national insolvency proceedings) is the preferred strategy. Entities with a liquidation strategy are excluded unless the relevant IRT decides otherwise.

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Key Takeaways

  • The SRB opened a public consultation on 11 May 2026 on a consolidated update to its operational guidance on liquidity and funding in resolution. The consultation closes 6 July 2026.
  • No new deliverables are introduced. The changes are targeted amendments and clarifications to existing expectations across four areas: KLE scope, estimation methodologies, governance, and collateral.
  • The KLE assessment perimeter is now broader. Banks must assess deposit platforms, SPVs, broker-dealers, insurance undertakings, asset managers, and other entity types against the four KLE identification conditions.
  • KLD identification must go beyond ILAAP risks. Banks must separately assess and score resolution-specific risks at KLE level, using granular time brackets around the resolution weekend.
  • Two scenarios are mandatory: slow-moving (12 months to resolution) and fast-moving (one month or less). Post-resolution forecasts must cover at least six months for bail-in strategies.
  • Banks must be able to produce the SRB’s standardised liquidity data at resolution group and KLE level, in material currencies, at intraday frequency, within 24 hours.
  • A new collateral template (Annex III) standardises time-to-mobilise estimates. Legal and operational obstacles must be mapped at instrument level.
  • The guidance applies only to banks with a resolution (not liquidation) preferred strategy under the SRB’s direct remit.

Sources and References

Disclaimer: The information on RegReportingDesk.com is for educational and informational purposes only. It does not constitute legal, regulatory, tax, or compliance advice. Always consult your compliance officer, legal counsel, or the relevant supervisory authority for guidance specific to your institution.

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