Bank living wills ensure no bank’s failure can create systemic collapses
Credit Suisse and BNP Cited by US for Issues in Living Wills
Fed and FDIC also identify shortcoming in BNP Paribas plan
The feedback letters are based on the watchdogs’ reviews of roadmaps submitted in 2021. These resolution plans were mandated as part of the Dodd-Frank legislation passed following the 2008 financial crisis.
Bloomberg 16 December 2200
Living Wills (or Resolution Plans)
https://www.federalreserve.gov/supervisionreg/resolution-plans.htm
CNBC Explains: Bank living wills
A bank’s living will is a mandatory annual report required by regulators.
The Federal Deposit Insurance Corp. and the Federal Reserve aim to ensure no bank’s failure can create systemic collapses elsewhere and living wills are supposed to provide a clear path through bankruptcy and possible liquidation.
APR 14 2016
https://www.cnbc.com/2016/04/14/cnbc-explains-bank-living-wills.html
Britain's major banks will have to tell investors in 2021 if they can be closed down without creating havoc in financial markets
https://www.reuters.com/article/us-britain-boe-banks-idUSKCN1UP1I9
Fed all but ended the formerly annual “living wills,”
challenging banks to explain how, if they were failing, authorities could dismantle them quickly with minimal collateral damage.
Now, for the largest institutions, the full plans are required only once every four years.
Imagine trying to wind down Lehman Brothers in 2008 using instructions drafted in 2004.
Bloomberg Editorial Board 14 september 2021
https://englundmacro.blogspot.com/2021/09/banks-consider-one-crucial-indicator-of.html
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