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More bank plans made public

By Marcie Geffner · Bankrate.com
Tuesday, January 21, 2014
Posted: 12 pm ET

Portions of the so-called resolution plans for the 116 banking companies that submitted such plans for the first time in December 2013 are now posted online, according to the Federal Reserve Board and Federal Deposit Insurance Corp., which jointly administer the program.

Certain large banks and bank holding companies are required by federal law to prepare resolution plans that describe their strategy to extricate themselves from major financial distress or a financial meltdown. The plans are mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act and must be submitted periodically to the government.

Third wave of resolution plans

The 116 companies whose initial resolution plans were due by Dec. 31, 2013, are those that generally have less than $100 billion in qualifying nonbank assets, the agencies said.

Two other groups have already filed plans. Companies with $250 billion or more in qualifying nonbank assets submitted their initial plans in July 2012 and their second annual plans in October 2013. Companies with $100 billion to $250 billion in qualifying nonbank assets submitted their initial plans in July 2013.

The public portions of these plans can be accessed as PDF files on the Federal Reserve and FDIC websites. The public sections haven't been edited or reviewed by the government, but instead are posted exactly as the companies submitted them.

Separate FDIC resolution plans

Concurrently, the FDIC released the public sections of recently filed resolution plans of 22 FDIC-insured depository institutions. The majority of these companies are subsidiaries of bank holding companies that concurrently submitted resolution plans, the agencies said.

These plans are required by a separate regulation issued by the FDIC and cover institutions with assets greater than $50 billion. The public portions of these plans are posted on the FDIC website.

Efficacy unknown

The plans are supposed to help the government quickly respond and, in an orderly fashion, unwind troubled banks that could jeopardize the global financial system.

Whether anyone is reading the public portions of the plans isn't clear. Nor is whether the resolution plans will work as promised or intended, should the need to implement them arise.

Are you confident that your bank is prepared for another financial crisis?

Follow me on Twitter: @marciegeff.

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