Final Rulemaking on Resolution Plans Required for Insured Depository Institutions with $100 Billion or More in Total Assets

Summary:

The Federal Deposit Insurance Corporation (FDIC) issued a final rule revising Section 360.10 of the FDIC's regulations and requiring the submission of resolution plans or informational filings by covered insured depository institutions (CIDIs).  [12 CFR 360.10]

Statement of Applicability: Insured depository institutions with $50 billion or more in total assets.

Highlights:

• The final rule strengthens existing requirements by requiring those CIDIs with $100 billion or more in total assets (group A CIDIs) to submit full resolution plans containing an identified strategy appropriate to the CIDI for its orderly and efficient resolution, as well as other information described in the final rule.
  • The final rule also requires CIDIs with at least $50 billion but less than $100 billion in total assets (group B CIDIs) to provide more limited resolution submissions in the form of an informational filing. The informational filing does not include all of the requirements applicable to the resolution plans submitted by group A CIDIs.  Among other things, it does not require development of an identified strategy for resolution nor the demonstration of capabilities necessary to produce valuations related to the FDIC’s least-cost determinations.
• The final rule amends and restates requirements with respect to informational content and capabilities, building on the prior rule, past guidance, and experience gained in past plan reviews and bank resolutions.
  • CIDIs are required to participate in engagement and capabilities testing regarding matters related to their resolution submissions and the information required under the final rule.
• The final rule amends how the FDIC assesses the credibility of resolution submissions and provides feedback to CIDIs, specifies requirements for engagement and capabilities testing, and clarifies expectations regarding the FDIC’s review and enforcement of CIDIs’ compliance with the rule.
• The frequency of full resolution submissions under the final rule for most CIDIs is three years with limited interim supplements for a specified subset of submission content items in the off years, and two years for CIDIs that are affiliates of U.S. global systemically important banking organizations.  These biennial filers are not required to submit a limited interim supplement in years where the group files a full or targeted Dodd-Frank resolution plan.
• Under the final rule, group A CIDIs’ initial filing date will be at least 270 days from the effective date of the final rule, while group B CIDIs’ initial filing date will be at least one year from the effective date of the final rule.