FDIC: Big banks’ living wills not credible and need to be revised

Justice League

So-called living wills submitted by big banks are “not credible” and have to be revised by next July, federal regulators said on Tuesday.

The Dodd-Frank financial reforms require certain big banks to submit plans detailing how they would wind themselves down in the event of a crisis. The 11 institutions subject to the rule submitted first-round plans in 2012 and revisions in 2013.

The Federal Deposit Insurance Corp. said each bank had specific shortcomings, and that all banks had a few in common—among them unrealistic assumptions and a failure to identify necessary changes in their structures.

Based on its review, the FDIC said “the plans submitted by the first-wave filers are not credible and do not facilitate an orderly resolution under the U.S. Bankruptcy Code.”

The regulator gave the banks til July 1, 2015 to file plans that “demonstrate that the firms are making significant progress to address all the…

View original post 10 more words

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s