Domestic Banks Pass FDIC And FRB Resolution Plan Evaluations

The FDIC and the Board of Governors of the Federal Reserve System ("FRB") finished evaluating the 2015 resolution plans of sixteen domestic banks, and separately issued guidance to four foreign banks.

Resolution plans (commonly known as living wills) are required by the Dodd-Frank Act to prepare for possible material financial distress or failure of a company. These plans describe a company's strategy for "rapid and orderly resolution" under bankruptcy. The agencies did not find that any of the resolution plans submitted in December 2015 by the sixteen firms (i) were not credible or (ii) would not facilitate an orderly resolution. One firm, Northern Trust, was identified as having shortcomings related to the funding and internal services available to keep the firm operating during a bankruptcy, and is required to address these shortcomings by year-end.