Regulation No. 2021-02 on Resolution Procedures for Financial Institutions

REGULATION
ON RESOLUTION PROCEDURES
FOR FINANCIAL INSTITUTIONS year 2021/ number 02 (Consolidated text as of 29/01/2026 - Update IV)

Central Bank of the Republic of San Marino
Regulation No. 2021-02 on resolution procedures for financial institutions – (Update IV)

INDEX

PART I INTRODUCTION .......................................................................................................................................4
TITLE I PREMISE ................................................................................................................................................4
Article I.I.1 - Legislative sources..................................................................................................................................... 4
Article I.I.2 - Definitions ............................................................................................................................................ 4

TITLE II CHARACTERISTICS OF THE DECISION .................................................................................5
Article I.II.1 - Subject matter ................................................................................................................................................ 5
Article I.II.2 - Objectives............................................................................................................................................... 5
Article I.II.3 - Preparation ........................................................................................................................................ 6
Article I.II.4 - Structure ............................................................................................................................................... 6
Article I.II.5 - Scope of application........................................................................................................................ 6
Article I.II.6 - Discretionary powers of the BCSM .......................................................................................................... 6

TITLE III COMMON PROVISIONS FOR RESOLUTION PROCEDURES ...........................................................7
Article I.III.1 - Requirements for the appointment of procedure officials and revocation of offices.............................. 7
Article I.III.2 - Candidate list ................................................................................................................................. 8
Article I.III.3 - Reimbursement of expenses ................................................................................................................................... 9
Article I.III.4 - Liability actions against members of dissolved bodies ............................................................ 10
Article I.III.5 - Financial support by BCSM to illiquid procedures ................................................................... 11
Article I.III.6 - Confidentiality of information acquired by BCSM ....................................................................... 12
Article I.III.7 - Continuity of office in succession of resolution procedures ............................................................... 12
Article I.III.8 - Publication of remuneration ............................................................................................................. 12

PART II SUSPENSION OF ADMINISTRATIVE BODIES........................................................................14
TITLE I GENERAL INTRODUCTION ............................................................................................................14
Article II.I.1 - Suspension procedure................................................................................................................... 14

TITLE II SPECIAL PROVISIONS....................................................................................................................14
Article II.II.1 - Appointment of Commissioner........................................................................................................................ 14
Article II.II.2 - Continuation of the Board of Statutory Auditors ................................................................................................... 14

PART III EXTRAORDINARY ADMINISTRATION............................................................................................15
TITLE I EFFECTS AND DURATION .............................................................................................................................15
Article III.I.1 - Effects of the extraordinary administration decision ............................................................ 15
Article III.I.2 - Duration of extraordinary administration ....................................................................................... 15

TITLE II INITIAL AND SUBSEQUENT COMPLIANCE........................................................................................16
Article III.II.1 - Appointment of procedure officials ......................................................................................... 16
Article III.II.2 - Initial compliance related to installation............................................................................... 16
Article III.II.3 - Subsequent compliance upon taking over.............................................................................. 17

TITLE III POWERS AND OPERATION OF THE PROCEDURE BODIES ...................................18
Article III.III.1 - General provisions ..................................................................................................................... 18
Article III.III.2 - Powers and operation of the Commissioner ...................................................................................... 19
Article III.III.3 - Powers and operation of the Supervisory Committee................................................................... 22
Article III.III.4 - Concrete methods of operation ............................................................................................. 22
Article III.III.5 - Reporting to the BCSM ................................................................................................................. 23

TITLE IV SUSPENSION OF PAYMENTS.....................................................................................................24
Article III.IV.1 - Preconditions and duration of suspension of payments .................................................................. 24
Article III.IV.2 - Procedure for suspension of payments ................................................................................. 24
Article III.IV.3 - General provisions on the suspension of payments.............................................................................. 25
Article III.IV.4 - Effects of the suspension................................................................................................................ 25

TITLE V REMUNERATION..............................................................................................................................................26
Article III.V.1 - Remuneration for procedure officials ....................................................................................... 26

TITLE VI FINAL COMPLIANCE......................................................................................................................27
Article III.VI.1 - General provisions..................................................................................................................... 27
Article III.VI.2 - Final balance sheet of extraordinary administration........................................................................ 28

PART IV COMPULSORY ADMINISTRATIVE LIQUIDATION..................................................................................30
TITLE I EFFECTS OF THE COMPULSORY ADMINISTRATIVE LIQUIDATION DECISION.............30

Central Bank of the Republic of San Marino
Regulation No. 2021-02 on resolution procedures for financial institutions – (Update IV)

Article IV.I.1 - General provisions........................................................................................................................ 30
Article IV.I.2 - Effects on corporate bodies and third parties ...................................................................... 30

TITLE II INITIAL AND SUBSEQUENT COMPLIANCE AFTER INSTALLATION.................................................30
Article IV.II.1 - Appointment of procedure officials......................................................................................... 30
Article IV.II.2 - Initial compliance related to installation............................................................................... 31
Article IV.II.3 - Subsequent compliance after installation...................................................................................... 32

TITLE III POWERS AND OPERATION OF LIQUIDATION BODIES................................................32
Article IV.III.1 - General provisions..................................................................................................................... 32
Article IV.III.2 - Powers and operation of the Commissioner...................................................................................... 33
Article IV.III.3 - Powers and operation of the Supervisory Committee .................................................................. 34

TITLE IV GENERAL DIRECTIVES AND ORGANIZATIONAL AND ACCOUNTING SETUP OF THE PROCEDURE34
Article IV.IV.1 - General directives........................................................................................................................... 34
Article IV.IV.2 - Organizational and accounting setup.................................................................................................. 35

TITLE V ASSESSMENT, DEPOSIT, AND CONSOLIDATION OF THE LIABILITY STATE ....................36
Article IV.V.1 - Assessment of liabilities ............................................................................................................... 36
Article IV.V.2 - Deposit of the liability state ........................................................................................................... 38
Article IV.V.3 - Content of the liability state ......................................................................................................... 38
Article IV.V.4 - Consolidation of the liability state................................................................................................ 39

TITLE VI LIQUIDATION OF ASSETS ........................................................................................................40
Article IV.VI.1 - General provisions on asset realization................................................................................ 40
Article IV.VI.2 - Bulk sales ......................................................................................................................... 40
Article IV.VI.3 - Atomistic asset recovery activities.................................................................................... 41
Article IV.VI.4 - Initiation of legal proceedings ................................................................................................................. 42

TITLE VII OPERATIONS SUBJECT TO SPECIAL DISCIPLINE ..................................................................42
Article IV.VII.1 - Passive operations ....................................................................................................................... 42

TITLE VIII PAYMENTS, DISTRIBUTIONS, AND RETURNS....................................................................................43
Article IV.VIII.1 - Payments from the estate................................................................................................................ 43
Article IV.VIII.2 - Payments of privileged and unsecured claims ......................................................................... 43
Article IV.VIII.3 - Return of financial instruments and assets subject to fiduciary ownership.................. 44

TITLE IX DECLARATION OF INSOLVENCY STATE.....................................................................................................46
Article IV.IX.1 - General provisions..................................................................................................................... 46
Article IV.IX.2 - Opinion of the BCSM........................................................................................................................ 46

TITLE X REPORTING TO THE BCSM................................................................................................................46
Article IV.X.1 - Periodic documentation ............................................................................................................. 46
Article IV.X.2 - Content of quarterly reports and annual accounting............................................................. 47

TITLE XI CLOSURE OF THE LIQUIDATION PROCEDURE........................................................................48
Article IV.XI.1 - Documentation to be submitted to the BCSM ................................................................................... 48
Article IV.XI.2 - Final tasks.......................................................................................................................... 49

TITLE XII REMUNERATION...........................................................................................................................................49
Article IV.XII.1 - Criteria for determining remuneration for liquidation bodies.............................................. 49
Article IV.XII.2 - Advances on remuneration for liquidation bodies.................................................................... 51
Article IV.XII.3 - Review of remuneration for liquidation bodies...................................................................... 51
Article IV.XII.4 - Final settlement of remuneration for liquidation bodies............................................... 51
Article IV.XII.5 - Settlement of remuneration in case of replacement of procedure officials ......................... 52
Article IV.XII.6 - Waiver of remuneration pro bono.................................................................................................... 52
Article IV.XII.7 - Payment of remuneration ................................................................................................................... 52

PART V BANK RESOLUTION IN CRISIS ......................................................................................................53
TITLE I EFFECTS AND DURATION .............................................................................................................................53
Article V.I.1 - Effects of the resolution decision ........................................................................................... 53
Article V.I.2 - Duration of resolution..................................................................................................................... 53

TITLE II INITIAL AND SUBSEQUENT COMPLIANCE........................................................................................53
Article V.II.1 - Appointment of procedure officials .......................................................................................... 53
Article V.II.2 - Initial compliance related to installation ................................................................................ 54
Article V.II.3 - Subsequent compliance upon taking over............................................................................... 55

TITLE III POWERS AND OPERATION OF THE PROCEDURE BODIES ...................................55

Central Bank of the Republic of San Marino
Regulation No. 2021-02 on resolution procedures for financial institutions – (Update IV)

Article V.III.1 - General provisions ...................................................................................................................... 55
Article V.III.2 - Powers and operation of the Commissioner ....................................................................................... 57
Article V.III.3 - Powers and operation of the Supervisory Committee.................................................................... 57
Article V.III.4 - Concrete methods of operation .............................................................................................. 58
Article V.III.5 - Reporting to the BCSM .................................................................................................................. 59

TITLE IV REMUNERATION ............................................................................................................................................59
Article V.IV.1 - Criteria for determining remuneration for resolution bodies................................................... 59
Article V.IV.2 - Special cases................................................................................................................................ 60

TITLE V FINAL COMPLIANCE .......................................................................................................................60
Article V.V.1 - General provisions ....................................................................................................................... 60

PART VI FINAL AND TRANSITIONAL PROVISIONS......................................................................................................62
TITLE I FINAL PROVISIONS......................................................................................................................................62
Article VI.I.1 - Entry into force............................................................................................................................... 62

TITLE II TRANSITIONAL PROVISIONS .......................................................................................................................62
Article VI.II.1 - Open resolution procedures............................................................................................................... 62
Article VI.II.2 - Start date of candidate list........................................................................................................... 63
Article VI.II.3 - Start date of remuneration publication .............................................................................................. 63
Article VI.II.4 - Start date of code of ethics..................................................................................................... 63
Article VI.II.5 - Start date of periodic information to creditors ................................................................................ 63

ANNEX I - CODE OF ETHICS..........................................................................................................................................64
ANNEX II - FAC-SIMILE COMMUNICATION OF INSTALLATION OF LIQUIDATION BODIES
........................................................................................................................................................66
ANNEX III - FAC-SIMILE LIABILITY STATE ....................................................................................................67
ANNEX IV - TABLES FOR DETERMINING REMUNERATION FOR COMPULSORY ADMINISTRATIVE
LIQUIDATIONS ................................................................................................................................................... 71

Central Bank of the Republic of San Marino
Regulation No. 2021-02 on resolution procedures for financial institutions – (Update IV)

PART I
INTRODUCTION
Title I
Premise
Article I.I.1 - Legislative sources

1. This Regulation falls within the category of implementing measures of Law No. 165 of 17 November 2005,
   provided for in Article 39, and finds its legislative framework of reference in Part II, Title II, Chapters I and II of the said Law and subsequent amendments, as well as, limited to bank crises, in Law No. 102 of 14 June 2019 and subsequent amendments.
2. The sanctioning powers of the Central Bank are instead provided for and regulated by Article 31 of Law No. 96 of 29 June 2005, and violation of the provisions contained in this Regulation is punished pursuant to Articles 18 and 18-bis of Decree No. 76 of 30 May 2006 and subsequent amendments.

Article I.I.2 - Definitions

1. For the purposes of this Regulation, the expressions used shall be understood as follows:

• “BCSM”: Central Bank of the Republic of San Marino;
• “CCR”: Committee for Credit and Savings;
• “CdS”: Supervisory Committee;
• “Commissioners”: the Commissioners appointed within the framework of extraordinary administration or suspension of administrative bodies procedures, the Special Administrators in bank resolution procedures, and the Liquidating Commissioners in compulsory administrative liquidation procedures;
• “procedure officials”: the Commissioners in suspension of administrative bodies procedures; the Commissioners and members of the supervisory committee in extraordinary administration procedures; the Special Administrators and members of the supervisory committee in bank resolution procedures; the Liquidating Commissioners and members of the supervisory committee in compulsory administrative liquidation procedures;
• “financial institutions”: companies with headquarters in the Republic of San Marino authorized to carry out activities included in the list referred to in Annex 1 of Law No. 165 of 17 November 2005 and subsequent amendments;
• “LCA”: compulsory administrative liquidation;
• “Bank Resolution Law”: Law No. 102 of 14 June 2019 and subsequent amendments;
• “Companies Law”: Law No. 47 of 23 February 2006 and subsequent amendments;
• “LISF”: Law No. 165 of 17 November 2005 and subsequent amendments;
• “Professional Orders”: Order of Lawyers and Notaries of the Republic of San Marino and Order of Chartered Accountants and Accounting Experts of the Republic of San Marino;

Central Bank of the Republic of San Marino
Regulation No. 2021-02 on resolution procedures for financial institutions – (Update IV)

• “resolution procedures”: suspension of administrative bodies, extraordinary administration, bank resolution, and compulsory administrative liquidation;
• “BCSM Statute”: Law No. 96 of 29 June 2005 and subsequent amendments.

2. In the remainder of the text, the use of terms subject to definition is highlighted in UPPERCASE.
3. Unless otherwise specified, for the purposes of these provisions, the definitions contained in the LISF and the COMPANIES LAW apply.

Title II
Characteristics of the decision
Article I.II.1 - Subject matter

1. This Regulation governs, for certain aspects not already regulated by law or delegated by it to the BCSM, the functioning of RESOLUTION PROCEDURES:
   a) by issuing general directives and concrete operational provisions for the PROCEDURE OFFICIALS herein, appointed by the BCSM, pursuant to Article 78 paragraph 2, and Article 88 paragraph 3, of the LISF as well as
   Article 4, paragraphs 5 and 6, of the BANK RESOLUTION LAW;
   b) defining the criteria for calculating the allowances due to the PROCEDURE OFFICIALS, pursuant to Articles 84 paragraph 3, 79 paragraph 4, and 86 paragraph 4 of the LISF