Federal Reserve Board and Federal Deposit Insurance Corporation (FDIC) officials recently completed evaluations of 14 banking organization 2017 resolution plans while issuing expectations for the next submissions.
Resolution plans, which are required by the Dodd-Frank Act and are commonly known as living wills, must describe a firm’s strategy for rapid and orderly resolution under bankruptcy in the event of material financial distress or failure of the firm.
No deficiencies or shortcomings, which are weaknesses the firms are required to address, were identified in the 2017 resolution plans. The agencies previously identified three shortcomings in Northern Trust Corporation’s 2015 resolution plan and decided Northern Trust’s 2017 resolution plan satisfactorily addressed the three shortcomings.
Feedback letters for each firm released by the Board noted agencies intend to issue for notice and comment proposed revisions to the resolution plan rule, including changes to implement the Economic Growth, Regulatory Relief, and Consumer Protection Act.
Letters also outlined expectations under the current rule requirements and explain agencies generally expect each firm’s 2019 submission to include material changes from its previous plan and updated financial statements.
The 14 firms evaluated included Ally Financial Inc., American Express Company, BB&T Corporation, Capital One Financial Corporation, Discover Financial Services, Fifth Third Bancorp, Huntington Bancshares Incorporated, KeyCorp, M&T Bank Corporation, Northern Trust Corporation, Regions Financial Corporation, SunTrust Banks, Inc., The PNC Financial Services Group, Inc., and U.S. Bancorp.