Follow Us

Follow us on Twitter  Follow us on LinkedIn
 

12 November 2014

FSB reports to G20 on Progress in Reforming Resolution Regimes and Resolution Planning


Default: Change to:


The report reviews what has been achieved so far and sets out further actions to implement the Key Attributes of Effective Resolution Regimes for Financial Institutions.


The FSB published its report to the G20 on progress in reform of resolution regimes and resolution planning for globally systemically important financial institutions (G-SIFIs). 

Effective resolution regimes and resolution planning are core to the FSB’s policy for ensuring that G-SIFIs can be resolved without recourse to public subsidy and without disruption to the wider financial system. The FSB has identified the following priorities for 2015 to help further advance progress in this area:

  • Finalise the common international standard on total loss absorbing capacity (TLAC) that globally systemic banks must have
  • Achieve the broad adoption of contractual recognition of temporary stays on early termination and cross-default rights in financial contracts and finalise FSB guidance on effective cross-border recognition
  • Develop further guidance to support resolution planning by home and host authorities, in particular in regard to funding arrangements and operational continuity of core critical services
  • Promote the full implementation of the FSB’s requirements for resolution regimes and resolution planning beyond the banking sector

FSB jurisdictions have made continued progress in adopting the powers and tools needed to resolve failing banks. Few jurisdictions have in place resolution regimes that are fully compliant with the Key Attributes and that also provide adequate powers for resolving failures in the non-bank financial sectors. The FSB will continue monitoring implementation of the Key Attributes to support implementation across all financial sectors, including for financial market infrastructures, insurers and firms that hold client assets.

The FSB also reports the initial results from the launch of the Resolvability Assessment Process (RAP). The RAP assesses the resolvability of each G-SIFI at the level of senior officials of the firm’s home and key host authorities. The initial assessments show that good progress has been made in resolution planning, but that material legal, operational and financial barriers to the feasibility and credibility of the resolution plans remain to be addressed. A number of those barriers relate to issues that are covered by the FSB work priorities for 2015 and may be mitigated as that work is finalised and implemented.

Full press release

Full report



© Financial Stability Board


< Next Previous >
Key
 Hover over the blue highlighted text to view the acronym meaning
Hover over these icons for more information



Add new comment