FSB publishes further guidance on resolution planning and fifth report to the G20 on progress in resolution

18 August 2016

The guidance papers contribute to the removal of impediments to the orderly and effective resolution of firms.

The Financial Stability Board published two final guidance papers to assist the resolution planning work of authorities and firms, as part of the policy agenda to end “too-big-to-fail”:

Guiding Principles on the Temporary Funding Needed to Support the Orderly Resolution of a Global Systemically Important Bank (G-SIB) – The guiding principles seek to address the risk of banks having insufficient liquidity to maintain critical operations during a resolution. They are intended to ensure that temporary funding is available to enable the effective resolution of G-SIBs without bail-out by the public sector. The guidance was issued for public consultation in November 2015 and has been revised in light of the comments received during that consultation. 

Guidance on Arrangements to Support Operational Continuity in Resolution – The guidance sets out arrangements to support the continuity of critical shared services, such as information technology infrastructure and software-related services, that are necessary to maintain a firm’s critical functions in resolution. The guidance was issued for public consultation in November 2015 and has been revised in light of the comments received during that consultation.

The FSB identified the following priorities for the remainder of 2016 and 2017 to help further advance progress:

• Develop further guidance on central counterparty resolution, building on the recently published discussion paper on Essential Aspects of CCP Resolution Planning which identifies elements that are considered to be core to the development of effective resolution strategies and plans for CCPs; 
• Finalise the remaining elements of the Total Loss-absorbing Capacity (TLAC) standard, including guidance on the implementation of internal TLAC and final proposals on TLAC holdings and TLAC disclosures; 
• Develop further guidance to support the resolution planning work of authorities and firms, including on ways in which access to financial market infrastructures can be maintained in resolution and on the operational execution of bail-in; and 
• Develop a Key Attributes assessment methodology for insurers and monitor implementation of the guidance on Developing Effective Resolution Strategies and Plans for Systemically Important Insurers.

Guiding Principles on the Temporary Funding Needed to Support the Orderly Resolution of a Global Systemically Important Bank

Guidance on Arrangements to Support Operational Continuity in Resolution

Full press release

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