FOR IMMEDIATE RELEASE: April 13, 2016
CONTACT: Laena Fallon, (202) 457-8783
WASHINGTON, D.C. – Financial Services Forum Acting CEO John Dearie issued the following statement in response to the announcement from the Federal Reserve and the FDIC regarding feedback provided to the largest banks on their resolution plans:
“Over the past six years enormous progress has been made to improve the safety, stability, and resilience of the U.S. financial system. Capital has doubled, liquidity has tripled, and annual stress tests show that large financial institutions can withstand a crisis far worse than 2008. Since the last living wills determinations, large financial institutions have worked strenuously to implement structural changes, streamline business models and lower risk in line with feedback received from the Federal Reserve and FDIC. By design, the living will process is iterative and will be ongoing, and the industry remains committed to continuing to work with regulators to ensure effective resolution and recovery planning.
“No financial company should be considered too big to fail. The principal regulators have said that there has been substantial progress in their ability to resolve the largest U.S. financial institutions. Furthermore, the cost of the failure of any large institution would be borne by the rest of the industry through FDIC assessments. The Dodd-Frank Act clearly mandates that taxpayer funds can never again be accessed – nor should they. Thus, it is in the best interest of the industry that all large institutions have credible resolutions plans and, with that in mind, institutions will continue to work to address the technical shortcomings identified in this round of regulatory feedback.
“It is beyond doubt that large U.S. banking companies are stronger, more streamlined, and more sound than before the 2008 crisis, holding capital and liquidity at levels far greater than at any other time in modern history. This additional strength puts large institutions in an even better position to meet the capital and credit needs of America’s businesses and households, and to accelerate economic growth and job creation.”