This will reduce the costs of resolution and hence the potential burden on the single resolution fund. Another side effect will be to reduce the urgency of having a single European deposit guarantee scheme. If banking supervision and resolution are conducted at a European level, the probability of banks defaulting should fall.
If a bank still gets into difficulties, supranational structures are in place to ensure it can exit the market in an efficient and orderly manner. This exit will be conducted in line with the Bank Recovery and Resolution Directive (BRRD). The directive envisages preferential treatment for depositors within the hierarchy of creditors, so they will have to be compensated far less often.