(23)The need for exclusion on the basis of the risk of widespread contagion might be affected by market conditions at the time of the bail-in, in particular when the failure of the firm takes place when the financial system is under significant stress or suffering from a lack of confidence. The risk that application of resolution tools and powers could have a significant direct or indirect adverse effect on financial stability and market confidence should be addressed in the resolvability assessment as requested in point 26 of Section C of the Annex of Directive 2014/59/EU. Therefore, when excluding from bail-in a liability under Article 44(3) of that Directive on the basis of the risk of widespread contagion, the resolution authority is expected to explain why the obstacles to bail-in have not been addressed in the course of resolution planning where those exclusions amount to an impediment to resolvability. The resolution authority should also assess whether the contagion effect results from, or is significantly aggravated by, the application of the bail-in tool to the liabilities in question, or in fact arises from the failure of the institution in and of itself.