Acting Comptroller Hsu Compares FTX To BCCI Rather Than Other Failures

This week, Acting Comptroller of the Currency Michael Hsu delivered remarks, titled "Trust and Global Banking: Lessons for Crypto," at the Institute of International Bankers' ("IIB") Annual Washington Conference in which he discussed the lack of consolidated supervision and coordination among regulators as part of the problem with the failure of crypto exchange FTX. He also offered lessons that can be learned from how bank supervision responded to the failure of the Bank of Credit and Commerce International ("BCCI") 30 years ago.

Acting Comptroller Hsu noted that in some press accounts, the bankruptcy of FTX is compared to the bankruptcy and failure of Lehman Brothers in the 2008 global financial crisis, but he thinks a better comparison is the failure of BCCI. In his view, BCCI took advantage of two inherent risks when a financial institution is operating in multiple jurisdictions in our global banking system. The first is an unlevel playing field, with rules