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The FDIC and the Federal Reserve Board (collectively, the "Agencies") finalized previously proposed guidance regarding the submission of the resolution plans with respect to certain large foreign banking organizations ("FBOs").
As previously covered, the proposed guidance was largely consistent with the 2018 FBO guidance and 2019 Domestic Covered Company guidance. The finalized guidance substantially reflects the proposal. However, the Agencies made several modifications to the proposed guidance in response to comments they received, including:
- updating the scope of the guidance to include FBOs that are Category II firms under the tailoring rule (see tailoring rule (see previous coverage);
- eliminating certain capital, liquidity and governance mechanisms, payment, clearing and settlement, and derivatives and trading activities expectations;
- removing from the scope, among other areas, guidance on group resolution plans, and the management information systems, qualified financial contracts and mapping of branch activities;
- eliminating, among other things, home/host coordination and supervisory information sharing expectations; and
- clarifying that all previous guidance not included in the consolidated guidance has been superseded.
The agencies noted that the final guidance is not intended to limit a firm's assessment of additional vulnerabilities or obstacles unique to its particular structure, operations or resolution strategy.
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