PRESS RELEASE
Federal Deposit Insurance Corporation Each Depositor insured to at least $250,000
FOR IMMEDIATE RELEASE
January 22, 2010
Media Contact:
Andrew Gray: (202) 898-7192
E-mail: angray@fdic.gov
Congress created the Federal Deposit Insurance Corporation in 1933 to restore public confidence in the nation's
banking system. It promotes the safety and soundness of these institutions by identifying, monitoring and addressing
risks to which they are exposed. The FDIC receives no federal tax dollars — insured financial institutions fund its
operations.
FDIC press releases and other information are available on the Internet at www.fdic.gov, by subscription electronically
(go to www.fdic.gov/about/subscriptions/index.html ) and may also be obtained through the FDIC's Public Information
Center (877-275-3342 or 703-562-2200). PR-13-2010
FDIC and Bank of England Announce Enhanced Cooperation in
Resolving Troubled Cross-border Financial Institutions
The Federal Deposit Insurance Corporation (FDIC) and the Bank of England today
announced their agreement to a memorandum of understanding (MOU) expanding their
cooperation when they act as resolution authorities in resolving troubled deposit-taking
financial institutions with activities in the United States and United Kingdom. The MOU
was signed by FDIC Chairman Sheila Bair and Bank of England Governor Mervyn King.
The MOU represents a commitment by the FDIC and Bank of England to enhance their
collaboration to promote greater coordination in the face of distress at banks that
operate in the two countries and thus protect the wider public interest. It recognizes the
importance of close and effective communication about the operations of financial
institutions covered by the MOU and differing national laws, consultation on developing
issues, cooperative contingency planning for firms covered by the MOU, and supporting
the development of appropriate recovery (going concern) and resolution (gone concern)
plans. In such areas, the MOU also underlines the need for the FDIC and the Bank to
work closely together with other authorities in the United States and the United
Kingdom.
Most importantly, the MOU represents a commitment to cooperate in the resolution of
cross-border firms in compliance with the laws and regulations of the United States and
the United Kingdom.
Bank of England Governor King and Chairman Bair agreed that this MOU is an
important step towards improved coordination.
FDIC Chairman Bair said, "The recent financial crisis demonstrates that greater
international coordination among resolution authorities as well as resolution processes
capable of resolving the largest, most complex financial institutions are necessary to
Federal Deposit Insurance Corporation Each Depositor insured to at least $250,000
FOR IMMEDIATE RELEASE
January 22, 2010
Media Contact:
Andrew Gray: (202) 898-7192
E-mail: angray@fdic.gov
Congress created the Federal Deposit Insurance Corporation in 1933 to restore public confidence in the nation's
banking system. It promotes the safety and soundness of these institutions by identifying, monitoring and addressing
risks to which they are exposed. The FDIC receives no federal tax dollars — insured financial institutions fund its
operations.
FDIC press releases and other information are available on the Internet at www.fdic.gov, by subscription electronically
(go to www.fdic.gov/about/subscriptions/index.html ) and may also be obtained through the FDIC's Public Information
Center (877-275-3342 or 703-562-2200). PR-13-2010
FDIC and Bank of England Announce Enhanced Cooperation in
Resolving Troubled Cross-border Financial Institutions
The Federal Deposit Insurance Corporation (FDIC) and the Bank of England today
announced their agreement to a memorandum of understanding (MOU) expanding their
cooperation when they act as resolution authorities in resolving troubled deposit-taking
financial institutions with activities in the United States and United Kingdom. The MOU
was signed by FDIC Chairman Sheila Bair and Bank of England Governor Mervyn King.
The MOU represents a commitment by the FDIC and Bank of England to enhance their
collaboration to promote greater coordination in the face of distress at banks that
operate in the two countries and thus protect the wider public interest. It recognizes the
importance of close and effective communication about the operations of financial
institutions covered by the MOU and differing national laws, consultation on developing
issues, cooperative contingency planning for firms covered by the MOU, and supporting
the development of appropriate recovery (going concern) and resolution (gone concern)
plans. In such areas, the MOU also underlines the need for the FDIC and the Bank to
work closely together with other authorities in the United States and the United
Kingdom.
Most importantly, the MOU represents a commitment to cooperate in the resolution of
cross-border firms in compliance with the laws and regulations of the United States and
the United Kingdom.
Bank of England Governor King and Chairman Bair agreed that this MOU is an
important step towards improved coordination.
FDIC Chairman Bair said, "The recent financial crisis demonstrates that greater
international coordination among resolution authorities as well as resolution processes
capable of resolving the largest, most complex financial institutions are necessary to
protect the public. This MOU is an invaluable step forward toward implementing the
recommendations of the Basel Committee's Cross Border Resolution Group, which the
FDIC co-chaired. It is also a further step in support of the continuing work of the
Financial Stability Board's Crisis Management Working Group, chaired by Paul Tucker
of the Bank of England."
Bank of England Governor King said, "A key legislative response in the United Kingdom
to the recent financial crisis has been the adoption of a special resolution regime that
enables failed UK banks to be resolved in the public interest. The Bank of England has
in consequence become a resolution authority in the United Kingdom and, as such, it
makes good sense to develop close relationships with other resolution authorities so
that the toolkit and powers now available to us can be applied effectively to large and
complex cross-border banks. The MOU should also help to enhance coordination with
other regulatory authorities in the United States and United Kingdom."
Attachment:
Memorandum of Understanding - PDF (PDF Help)
# # #
Notes to editors:
1. Congress created the Federal Deposit Insurance Corporation in 1933 to restore
public confidence in the nation's banking system. The FDIC insures deposits at the
nation's 8,099 banks and savings associations and it promotes the safety and
soundness of these institutions by identifying, monitoring and addressing risks to which
they are exposed. The FDIC receives no federal tax dollars – insured financial
institutions fund its operations.
2. The Bank of England has two core purposes: it exists to ensure monetary stability
and to contribute to financial stability. In February 2009, the Banking Act 2009 was
introduced which gave the Bank new responsibilities and powers in relation to financial
stability. A key part of the Banking Act was the creation of a Special Resolution Regime
(SRR) which gives the UK Tripartite authorities – the Treasury, Bank of England and
Financial Services Authority (FSA) - a permanent framework providing tools for dealing
with distressed banks and building societies. Further information about the UK Special
Resolution Regime is available on the Bank of England's website
at: http://www.bankofengland.co.uk/financialstability/role/risk_reduction/srr/
recommendations of the Basel Committee's Cross Border Resolution Group, which the
FDIC co-chaired. It is also a further step in support of the continuing work of the
Financial Stability Board's Crisis Management Working Group, chaired by Paul Tucker
of the Bank of England."
Bank of England Governor King said, "A key legislative response in the United Kingdom
to the recent financial crisis has been the adoption of a special resolution regime that
enables failed UK banks to be resolved in the public interest. The Bank of England has
in consequence become a resolution authority in the United Kingdom and, as such, it
makes good sense to develop close relationships with other resolution authorities so
that the toolkit and powers now available to us can be applied effectively to large and
complex cross-border banks. The MOU should also help to enhance coordination with
other regulatory authorities in the United States and United Kingdom."
Attachment:
Memorandum of Understanding - PDF (PDF Help)
# # #
Notes to editors:
1. Congress created the Federal Deposit Insurance Corporation in 1933 to restore
public confidence in the nation's banking system. The FDIC insures deposits at the
nation's 8,099 banks and savings associations and it promotes the safety and
soundness of these institutions by identifying, monitoring and addressing risks to which
they are exposed. The FDIC receives no federal tax dollars – insured financial
institutions fund its operations.
2. The Bank of England has two core purposes: it exists to ensure monetary stability
and to contribute to financial stability. In February 2009, the Banking Act 2009 was
introduced which gave the Bank new responsibilities and powers in relation to financial
stability. A key part of the Banking Act was the creation of a Special Resolution Regime
(SRR) which gives the UK Tripartite authorities – the Treasury, Bank of England and
Financial Services Authority (FSA) - a permanent framework providing tools for dealing
with distressed banks and building societies. Further information about the UK Special
Resolution Regime is available on the Bank of England's website
at: http://www.bankofengland.co.uk/financialstability/role/risk_reduction/srr/