Release Date: January 29, 2016
For release at 5:00 p.m. EST
The Federal Reserve Board on Friday extended until February 19, 2016, the comment period for its proposed rule to strengthen the ability of the largest domestic and foreign banks operating in the United States to be resolved without extraordinary government support or taxpayer assistance.
The proposed rule requires U.S. global systemically important banks (GSIBs) and the U.S. operations of foreign GSIBs to meet a long-term debt requirement, a "total loss-absorbing capacity," or TLAC, requirement, and a requirement that the parent holding company of a domestic GSIB avoid entering into certain financial arrangements that would create obstacles to an orderly resolution. These requirements would strengthen the ability of those banks to withstand financial stress and failure without imposing losses on taxpayers. The proposed rule also includes regulatory capital deductions for Board-regulated banking firms that hold unsecured debt of the parent holding companies of domestic GSIBs.
The Board extended the comment period to allow interested persons more time to analyze the issues and prepare their comments. Originally, comments were due by February 1, 2016.