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PRESS RELEASE
Federal Deposit Insurance Corporation Each Depositor insured to at least $250,000
FOR IMMEDIATE RELEASE
September 13, 2011
Media Contact:
Andrew Gray
(202) 898-7192
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-150-2011
FDIC Board Approves Interim Final Rule Requiring Resolution Plans for
Insured Depository Institutions Over $50 Billion
The FDIC today approved an Interim Final Rule that would require an insured
depository institution with $50 billion or more in total assets to submit periodic
contingency plans to the FDIC for resolution in the event of the financial institution's
failure. The rule requires these insured institutions to submit a resolution plan that will
enable the FDIC, as receiver, to resolve the bank to ensure that depositors receive
access to their insured deposits within one business day of the institution's failure,
maximize the net present value return from the sale or disposition of its assets and
minimize the amount of any loss to be realized by the institution's creditors.
The rule seeks to address a key lesson from the recent financial crisis that resolution
plans for large and complex insured depository intuitions are essential for their orderly
and least-cost resolution. The Interim Final Rule enables the FDIC to perform its
resolution functions most efficiently by requiring the largest insured depository
institutions to engage in extensive planning that will, in cooperation with the FDIC,
enhance the FDIC's ability to reduce losses to the Deposit Insurance Fund and resolve
the institutions in a manner that limits any disruption from their insolvency. The Interim
Final Rule also sets specific standards for the resolution plans, including requiring a
strategic analysis of the plan's components, a description of the strategies for achieving
the least costly resolution, and analyses of the financial company's organization,
material entities, interconnections and interdependencies, and management information
systems among other elements.
Currently, 37 insured depository institutions are covered by the interim final rule. Those
institutions held approximately $3.6 trillion in insured deposits or nearly 60% of all
insured deposits as of December 31, 2010.
FDIC Acting Chairman Martin J. Gruenberg said, "The FDIC's Interim Final Rule
requiring insured depository institutions with assets over $50 billion to submit resolution
plans is intended to serve as a complement to the joint rulemaking with the Federal
Reserve under the Dodd-Frank Act that was also approved by the FDIC Board today.
These two rules will ensure the comprehensive and coordinated resolution planning for
both the insured depository and its holding company and affiliates in the event that an
orderly liquidation is required. The rules will also facilitate improved efficiencies and risk
management practices among covered institutions as they produce and evaluate these
plans."
The Interim Final Rule was adopted by the Board under the Federal Deposit Insurance
Act and complements separate rulemaking pursuant to Section 165(d) of the Dodd-
Frank Wall Street Reform and Consumer Protection Act. The Dodd-Frank joint
rulemaking requires that certain systemically important nonbank financial companies
and bank holding companies prepare resolution plans for such entities to be resolved in
an orderly manner under the bankruptcy code.
The interim final rule authorizes its publication in the Federal Register with a 60-day
comment period and an effective date of January 1, 2012.
Attachments:
Interim Final Rule on Resolution Plans Required for Insured Depository Institutions with
$50 Billion or More in Total Assets - PDF (PDF Help)
Resolution Plan Work Streams - PDF (PDF Help)