Fed, FDIC Provide Details on ‘Living Wills’ for Largest Banks

The FDIC and the Federal Reserve today provided information to eight large financial institutions to guide their targeted resolution plan submissions, which are due July 1, 2021. These so-called “living wills” outline how firms would facilitate an orderly resolution under the Bankruptcy Code.

The 2021 plans will be required to include core elements such as capital, liquidity and recapitalization strategies, as well as how each firm has integrated changes and lessons learned from its response to the coronavirus into its resolution planning process.

Firms were also informed of the results of a recent “critical operations” review by the FDIC and Fed which identified operations at certain firms that could threaten U.S. financial stability if they failed or were discontinued.