The Clearing House (TCH), jointly with the IIF and GFMA, commented on two (here and here) consultations issued by the Financial Stability Board at the end of last year. These two consultations – one on resolution funding strategies and the other on the mechanics of bail-in execution – represent the final build-out of the FSB’s multi-year effort to develop a common set of principles governing the resolution of global systemically important banks, or G-SIBs. Both letters are generally supportive of the principles outlined in the consultations, though TCH recommended certain refinements. Regarding resolution funding strategies and plans, TCH recommended that the FSB principles specifically take into account likely actions under a G-SIB’s recovery plan, and that home resolution authorities publicly provide a general, non-firm specific overview of their resolution funding plans and preferred resolution strategies once they are fully developed. Regarding bail-in execution, TCH generally recommended that authorities provide as much ex ante disclosure and transparency as possible of the bail-in mechanics to reduce market uncertainty.
You Might Also Be Interested In...
Resolution & Recovery Planning FDIC Special Assessment Proposal Lacks Analysis and Needs Adjustment to Avoid Unintended Side Effects
Resolution & Recovery Planning BPI Comments on Advance Notice of Proposed Rulemaking on Resolution-related Resource Requirements for Large Banks
Resolution & Recovery Planning New Large Bank Resolution Requirements Would Be Costly and Unnecessary
More Posts by This Author
Bank Capital and Stress Testing U.S. Bank Capital Levels: Aligning With or Exceeding Midpoint Estimates of Optimal
Central Bank Digital Currency BPI’s Paige Pidano Paridon Testifies on CBDC Before House Subcommittee
Bank Activities and Structure BPI Statement Before the U.S. House Financial Services Committee’s Subcommittee on Digital Assets, Financial Technology and Inclusion
Bank Activities and Structure BPI Statement Before the U.S. House Financial Services Committee’s Subcommittee on Financial Institutions and Monetary Policy
Basel Finalization BPI’s Greg Baer Testifies on Basel Endgame Before House Financial Services Subcommittee