Banking agencies signal new ‘living will’ guidance for large banks

The Federal Reserve and the FDIC will issue guidance on so-called “living wills” for banks that are considered “Category II” or “Category III” firms under the Fed’s tailored enhanced prudential standards, the agencies said late Friday.

The forthcoming guidance “would apply to Category II and Category III banking organizations—generally those with more than $250 billion in total assets but that are not global systemically important banks—and which have not already received guidance,” the agencies said. “Larger and more complex banks are already subject to guidance from the agencies.” They added that they will provide opportunity for public comment on the guidance before it is finalized.

The agencies also said Friday that they did not find any “shortcomings” or “deficiencies” in a resolution plan submitted by Truist Financial Corporation for 2021.