WASHINGTON — Bank regulators rejected three foreign banking organizations' resolution plans — so-called "living wills" — that were submitted last year, finding "shortcomings" and ordering the institutions to make certain improvements when they resubmit their plans this year.

French bank BNP Paribas and UK-based HSBC Holdings and the Royal Bank of Scotland were each sent feedback letters on their 2014 resolution plans on Monday by the Federal Reserve Board and the Federal Deposit Insurance Corp. which detailed "specific shortcomings in each firm's plan and the expectations of the agencies for the 2015 submission."

Those shortcomings include "unrealistic or inadequately supported assumptions" about customer behavior and market participant reaction to a failure and "inadequate analysis regarding interconnections within the firms," according to a statement by the Fed and FDIC.

The Dodd-Frank Act requires systemically important financial institutions, or SIFIs, to establish living wills in order to minimize the disruptive effect of major banks' liquidation. Under the law, if the Fed and FDIC both deem a bank's resolution plan to be "not credible", the banks has one year to shape up or face very onerous supervisory consequences by the Fed.

The banks have been working on their living wills since 2011 but regulators only gave public feedback on the plans for the first time in August, when they rejected 11 resolution plans from the most complex banks. The FDIC was inclined to start the one-year clock last year, but the Fed opted instead to find that the bank plans had "shortcomings", effectively giving the banks another year to comply.

The banks listed on Monday were also deemed "not credible" by the FDIC but the Fed gave them the same additional year to comply as the larger banks.

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