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Regulators' evaluation of last year's "living wills" submitted by the biggest banks was touted as an important step in ending "too big to fail," but the agencies have failed to provide any feedback on previous plans just weeks before the next set are due.
June 16 -
Regulators' reviews of big banks' internal resolution plans will become more rigorous in 2014 as a debate grows over what parts of the plans can be seen by the public.
January 10
WASHINGTON Three nonbank giants, recently designated as "systemically important" by federal regulators, have joined their banking counterparts in drafting blueprints for how they could be unwound in a failure.
The firms General Electric Capital Corp. and the insurance giants American International Group and Prudential Financial submitted first drafts of their so-called "living wills" this week to the Federal Deposit Insurance Corp. and Federal Reserve Board.
The nonbank companies were recently added to the list of global companies considered systemically risky that the Financial Stability Oversight Council can subject to new regulatory standards created under the Dodd-Frank Act. Those requirements include developing plans outlining how they would be resolved in a traditional bankruptcy. The reform law requires resolution plans for each bank holding company with over $50 billion in assets as well as nonbanks that the FSOC designates as "systemically important."
The plans which include condensed
The three companies joined 13 bank holding companies that on Wednesday filed updates of their previously submitted plans. Some banking giants considered most complex by the regulators had submitted their first plans as early as 2012. Those banks have now filed a total of three installments, but are still waiting to hear feedback from regulators on their second-round plans, which were completed last year.
The plans' public portions provide a high-level description of each firm's structure as well as a basic narrative of how they would be resolved in a failure scenario. The more comprehensive versions seen only by regulators contain much greater detail, with some individual plans said to encompass thousands of pages.