I plan to vote in favor of the final Title I resolution plan guidance for domestic and foreign triennial full filers. I agree with the decision not to provide specific guidance on derivatives and trading activities given the relatively small size of these activities for triennial filers, and I appreciate the agencies’ clarification that foreign triennial filers are not expected to include information about their global resolution plans when such firms do not have access to those plans.1 Additionally, I support the extension of the next resolution plan submissions for these firms until October 1, 2025, which is consistent with the agencies’ commitment under the rule to provide at least one year following the finalization of any guidance,2 and for which I have strongly advocated.3
Although I will vote in favor of the final guidance, I do have a few reservations. I think we may want to revisit this guidance in the future, depending on whether and how the proposed long-term debt rule4 is finalized. Relatedly, at some point it may be worth exploring an “SPOE-lite” approach for non-GSIBs with an SPOE resolution strategy. I also continue to have some skepticism of requiring firms with an MPOE resolution strategy to explain how an IDI resolution would comply with the least-cost test, given that we have a separate resolution planning rule governing IDIs,5 and given the substantial uncertainty around trying to estimate the cost of resolution options at the point of failure.
Nonetheless, I plan to vote in favor of the guidance and would like to thank the staff for their continued work on this issue.
- 1
See Federal Reserve System, Federal Deposit Insurance Corporation, Final Guidance for Resolution Plan Submissions of Foreign Triennial Full Filers, p. 26 (“…the agencies recognize that not all firms have access to the group-wide resolution plan for that financial institution. Accordingly, the final guidance clarifies that firms are not expected to provide information that they do not possess and does not include an expectation that firms specifically identify the extent to which resolution planning under the Rule relies on different assumptions, strategies, and capabilities from the global plan.”).
- 2
See Federal Reserve System, Federal Deposit Insurance Corporation, Resolution Plans Required, 84 Fed. Reg. 59,194 (Nov. 1, 2019) (“…the agencies intend to make any future general guidance concerning resolution planning available for public comment, and will endeavor to finalize any such general guidance at least one year prior to the submission date for the first resolution plan submission to which it would apply.”).
- 3
See, e.g., Statement by Vice Chairman Travis Hill on the Extension of Title I Resolution Plan Submission Deadline for Triennial Full Filers (Jan. 16, 2024) (“I would have preferred that the agencies extend the upcoming deadline to one year after the guidance is finalized – rather than to a particular date in March 2025 – given that the guidance may not be finalized by March 2024.”).
- 4
See Office of the Comptroller of the Currency, Federal Reserve System, Federal Deposit Insurance Corporation, Long-Term Debt Requirements for Large Bank Holding Companies, Certain Intermediate Holding Companies of Foreign Banking Organizations, and Large Insured Depository Institutions, 88 Fed. Reg. 64,524 (Sept. 19, 2023).
- 5
See Federal Deposit Insurance Corporation, Resolution Plans Required for Insured Depository Institutions With $100 Billion or More in Total Assets; Informational Filings Required for Insured Depository Institutions With at Least $50 Billion but Less Than $100 Billion in Total Assets, 89 Fed. Reg. 56,620 (July 9, 2024).