"Regulators from the U.S. and the United Kingdom took a major step Monday toward proving that they could dismantle a large globally active financial institution, outlining how the two sides would cooperate in the event of a cross-border resolution," writes American Banker's Joe Adler.
The FDIC, which recently under the Dodd-Frank reform law has been given the power to unwind systemically important firms, has approved of the "single point of entry" resolution for months.
Paul Tucker, Bank of England Deputy Governor, told FDIC officials that his country would allow the agency to operate freely in resolving U.S. firms that have significant U.K. operations.
In a meeting of the FDIC's Systemic Resolution Committee, Tucker stated, "I genuinely believe that the United Kingdom authorities are prepared in principle to stand back and let you execute a resolution of the massive U.S. groups which have massive operations in the U.K., and to leave it to you to do it, without our stepping in and interfering or grabbing the subsidiaries or the branches [or] the assets of the businesses that are domiciled in the U.K."
For the full piece see "U.S. and U.K Step Up Efforts to Harmonize Wind-Down Regimes" (may require subscription).