Resolution Plans

On April 16, 2019, the Federal Deposit Insurance Corporation (“FDIC”) announced its approval of an Advance Notice of Proposed Rulemaking (“ANPR”) inviting comment on ways to improve its rule requiring insured depository institutions with $50 billion or more in total assets (“Covered Insured Depository Institutions” or “CIDIs”) to submit periodic resolution plans to the FDIC (the “IDI Rule”).  In a statement accompanying the ANPR, FDIC Chairman Jelena McWilliams noted that “[a]fter several years of reviewing the IDI plans that firms submit, we are interested to learn how we can make this process more tailored and targeted, while continuing to advance the FDIC’s important resolution readiness efforts.”

Continue Reading FDIC Seeks Comment on Improvement of the IDI Rule

On November 28, 2018, Federal Deposit Insurance Corporation (“FDIC”) Chairman Jelena McWilliams delivered keynote remarks regarding resolution planning requirements at the 2018 Annual Conference of The Clearing House and Bank Policy Institute.  Chairman McWilliams repeatedly emphasized that the failure of a financial institution should be dealt with through bankruptcy.  She stated that she strongly supports legislation that would establish a more tailored, transparent process for large financial firms under the Bankruptcy Code.  According to McWilliams, “[t]he FDIC stands ready to work with Congress and hopes to see such a measure signed into law.”  Additionally, the FDIC is considering refinements to the Orderly Liquidation Authority (the process created in the Dodd-Frank Act as an alternative to bankruptcy for large financial institutions), including recommendations from the Treasury Department published earlier this year.

Notably, Chairman McWilliams described two rulemaking that are expected in the coming months regarding resolution plans required by:

  • Section 165(d) of the Dodd-Frank Act for bank holding companies (“BHCs”) with $50 billion or more in total consolidated assets (“165(d) resolution plans”); and
  • The FDIC rule for insured depository institutions (“IDIs”) with $50 billion or more in total consolidated assets (“IDI resolution plans”).

Continue Reading FDIC Previews Changes to Resolution Plan Requirements

On July 16, 2018, Republican and Democratic leadership of the House Financial Services Committee announced that they have reached agreement to advance a package of financial services reforms known as the “JOBS Act 3.0,” consisting of 32 pieces of legislation that have passed the Committee or the full House with bipartisan support.

While much of the package is focused on capital markets regulation, several of the component bills relate to prudential or consumer financial services matters.

Continue Reading House Committee Agrees on JOBS Act 3.0

On March 24, 2017, the Federal Reserve Board and the Federal Deposit Insurance Corporation (the “Agencies”) jointly announced that they had completed their evaluation of  the resolution plans submitted by 16 domestic banks, primarily regional banks, in December 2015, as required by the Dodd-Frank Act. The Agencies did not determine that any of the  16 plans were incomplete or not credible but identified several shortcomings in one bank’s plan around liquidity, the transfer of uninsured and foreign deposits, and shared services, which must be satisfactorily addressed in the bank’s December 2017 plan. The remaining 15 banks will be entitled to submit plans with more limited information in December 2017.

Continue Reading Federal Agencies Complete Evaluation of Resolution Plans of 16 Domestic and Four Foreign Banks