FRANKFURT, Jan 27 (Reuters) - The European Central Bank said on Tuesday it was changing guidelines to allow it to lend to banks that are being wound down, tackling a long-standing issue in the
ECB Revises Guidelines to Facilitate Lending to Failing Banks
ECB's New Lending Guidelines
FRANKFURT, Jan 27 (Reuters) - The European Central Bank said on Tuesday it was changing guidelines to allow it to lend to banks that are being wound down, tackling a long-standing issue in the European Union's framework for handling bank failures.
Conditions for Lending
The ECB said banks that are in resolution would now be given access to the central bank's liquidity provision "provided they meet certain conditions", such as having enough capital.
Background on Resolution Framework
A 2017 run on Spain's Banco Popular exposed a hole in EU rules that bar the ECB, the euro zone's central bank, from supporting a failing lender while the EU's Single Resolution Board organises a rescue.
It was one of just two cases in which the EU's decade-old resolution framework has been applied, the other being the resolution of some European units of Russia's Sberbank following sanctions against Russia in 2022.
(Reporting by Francesco CanepaEditing by Peter Graff)
