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FEDERAL RESERVE SYSTEM
[Docket No. OP–1817]

FEDERAL DEPOSIT INSURANCE
CORPORATION
RIN 3064–ZA38

Guidance for Resolution Plan
Submissions of Foreign Triennial Full
Filers
Board of Governors of the
Federal Reserve System (Board) and
Federal Deposit Insurance Corporation
(FDIC).
ACTION: Final guidance.
AGENCY:

The Board and the FDIC
(together, the agencies) are adopting this
final guidance for the 2025 and
subsequent resolution plan submissions
by certain foreign banking organizations
(FBOs). The final guidance is meant to
assist these firms in developing their
resolution plans, which are required to
be submitted under the Dodd-Frank
Wall Street Reform and Consumer
Protection Act, as amended (the DoddFrank Act), and the jointly issued
implementing regulation (the Rule). The
scope of application of the final
guidance is foreign triennial full filers
(specified firms or firms), which are
foreign Category II and III banking
organizations, and the guidance
supersedes the joint Guidance for
Resolution Plan Submissions of Certain
Foreign-Based Covered Companies. The
final guidance describes the agencies’
expectations, depending on the
resolution strategy chosen by the firm,
regarding a number of key
vulnerabilities in plans for an orderly
resolution under the U.S. Bankruptcy
Code (i.e., group resolution plan;
capital; liquidity; governance
mechanisms; operational; legal entity
rationalization and separability;
branches; and insured depository
institution (IDI) resolution, if
applicable). The final guidance modifies
and clarifies certain aspects of the
proposed guidance based on the
agencies’ consideration of comments to
the proposal, additional analysis, and
further assessment of the business and
risk profiles of the firms.
DATES: The final guidance is available
on August 15, 2024.
FOR FURTHER INFORMATION CONTACT:
Board: Catherine Tilford, Deputy
Associate Director, (202) 452–5240,
Elizabeth MacDonald, Assistant
Director, (202) 475–6316, Tudor Rus,
Manager, (202) 475–6359, Mason Laird,
Senior Financial Institution Policy
Analyst II, (202) 912–7907, Caroline
Elkin, Senior Financial Institution

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SUMMARY:

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Policy Analyst, (202) 263–4888,
Division of Supervision and Regulation;
or Jay Schwarz, Deputy Associate
General Counsel, (202) 452–2970;
Andrew Hartlage, Special Counsel, (202)
452–6483; Brian Kesten, Counsel, (202)
843–4079; or Sarah Podrygula, Senior
Attorney, (202) 912–4658, Legal
Division, Board of Governors of the
Federal Reserve System, 20th Street and
Constitution Avenue NW, Washington,
DC 20551. For users of TTY–TRS, please
call 711 from any telephone, anywhere
in the United States.
FDIC: Robert C. Connors, Senior
Advisor, (202) 898–3834; Mark E. Haley,
Chief, (917) 320–2911, Patrick R.
Bittner, Senior Policy Specialist, (202)
898–6571, Division of Complex
Financial Institution Supervision and
Resolution; Celia Van Gorder, Assistant
General Counsel (Acting), (202) 898–
6749; Dena S. Kessler, Counsel, (202)
898–3833; Gregory J. Wach, Counsel,
(202) 898–6972, Legal Division.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Introduction
A. Background
B. Connection to Other Rulemakings
C. Proposed Guidance
II. Overview of Comments
III. Final Guidance
A. Scope of Application
B. Transition Period
C. Interaction With Group Resolution Plan
D. Capital
E. Liquidity
F. Governance Mechanisms
G. Operational
H. Legal Entity Rationalization and
Separability
I. Insured Depository Institution Resolution
J. Derivatives and Trading Activities
K. Branches
L. Format and Structure of Plans;
Assumptions
M. Additional Comments
IV. Paperwork Reduction Act
V. Text of the Final Guidance

I. Introduction
A. Background
Section 165(d) of the Dodd-Frank
Act 1 and the Rule 2 require certain
financial institutions to report
periodically to the Board and the FDIC
their plans for rapid and orderly
resolution under the U.S. Bankruptcy
Code (the Bankruptcy Code) in the event
of material financial distress or failure.
The Rule divides covered companies
into three groups of filers: (a) biennial
filers; (b) triennial full filers; and (c)
triennial reduced filers.3 The terms
‘‘covered company’’ and ‘‘triennial full
1 12

U.S.C. 5365(d).
CFR parts 243 and 381.
3 12 CFR 243.4 and 381.4.
2 12

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filer’’ have the meanings given in the
Rule, as do other, similar terms used
throughout this final guidance
document.
Triennial full filers under the Rule are
required to file a resolution plan every
three years, alternating between full and
targeted resolution plans.4 The Rule
requires each covered company’s full
resolution plan to include, among other
things, a strategic analysis of the plan’s
components, a description of the range
of specific actions the covered company
proposes to take in resolution, and a
description of the covered company’s
organizational structure, material
entities, and interconnections and
interdependencies.5 Targeted resolution
plans are required to include a subset of
information contained in a full plan.6 In
addition, the Rule requires that all
resolution plans consist of two parts: a
confidential section that contains any
confidential supervisory and proprietary
information submitted to the agencies,
and a section that the agencies make
available to the public.7 Public sections
of resolution plans can be found on the
agencies’ websites.8
Recent Developments
Implementation of the Rule has been
an iterative process aimed at
strengthening the resolution planning
capabilities of financial institutions
subject to the Rule. To assist the
development of covered companies’
resolution planning capabilities and
plan submissions, the agencies have
provided feedback on individual plan
submissions, issued guidance to certain
groups of covered companies, and
issued answers to frequently asked
questions. The agencies believe that
guidance can help focus the efforts of
similarly situated covered companies to
improve their resolution capabilities
and clarify the agencies’ expectations
for those filers’ future progress in their
resolution plans. To date, the agencies
have issued guidance to: (a) U.S. global
systemically important banks (GSIBs),9
which constitute the biennial filer
group; and (b) certain large FBOs that
4 12

CFR 243.4(b) and 381.4(b).
CFR 243.5 and 381.5.
6 12 CFR 243.6(b) and 381.6(b).
7 12 CFR 243.11(c) and 381.11(c).
8 The public sections of resolution plans
submitted to the agencies are available at
www.federalreserve.gov/supervisionreg/resolutionplans.htm and www.fdic.gov/regulations/reform/
resplans/.
9 Guidance for section 165(d) Resolution Plan
Submissions by Domestic Covered Companies
applicable to the Eight Largest, Complex U.S.
Banking Organizations, 84 FR 1438 (Feb. 4, 2019)
(2019 U.S. GSIB Guidance).
5 12

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are triennial full filers.10 The agencies
have not, however, thus far issued
guidance to domestic triennial full filers
and the additional FBOs that make up
the remainder of the triennial full filers.
Several developments inform the final
guidance:
• The agencies’ consideration of
comments to the proposed guidance (as
defined below);
• The agencies’ review of foreign
triennial full filers’ 2021 resolution
plans and the issuance of individual
letters communicating the agencies’
feedback on those submitted plans;
• The agencies’ recent experience
with UBS Group AG’s acquisition of
Credit Suisse Group AG (CS) and, with
respect to specified firms with large
subsidiary IDIs, the resolutions of
Silicon Valley Bank (SVB), Signature
Bank (SB), and First Republic Bank
(First Republic), and related stress
experienced by a range of other
financial institutions; and
• The agencies’ analysis of the
current risk profiles of the foreign
triennial full filers.
The preamble to the 2019 revisions to
the Rule indicated that the agencies
would make any future resolution
guidance available for comment,11 and
on August 29, 2023, the agencies invited
comments on proposed guidance for the
2024 and subsequent resolution plan
submissions by foreign triennial full
fillers (proposed guidance or
proposal).12
The Rule requires triennial full filers
to submit their resolution plans on or
before July 1 of each year in which a
resolution plan is due.13 At the time the
agencies issued the proposed guidance,
the foreign triennial full filers were
required to submit their next resolution
plans on or before July 1, 2024. In the
proposal, the agencies requested
comment about whether the agencies
should provide more than six months
for firms to take into consideration the
expectations in the finalized guidance.
Several comments discussed the timing
of the next resolution plan submission
and its relationship to the final
guidance. Most requested extensions,
with several requesting at least a year
10 Guidance for Resolution Plan Submissions of
Certain Foreign-Based Covered Companies 2020
FBO Guidance, 85 FR 83557 (Dec. 22, 2020) (2020
FBO Guidance).
11 Resolution Plans Required, 84 FR 59194, 59204
(Nov. 1, 2019) (2019 Federal Register Rule
Publication).
12 https://www.federalreserve.gov/newsevents/
pressreleases/bcreg20230829b.htm; https://
www.fdic.gov/news/press-releases/2023/
pr23067.html. See also Guidance for Resolution
Plan Submissions of Foreign Triennial Full Filers,
88 FR 64641 (Sept. 19, 2023).
13 12 CFR 243.4(b)(3) and 381.4(b)(3).

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and one stating six months would be
adequate. One stated a maximum of six
months from publication of the final
guidance to the first submission would
be adequate, though it did not
specifically ask for an extension.
On January 17, 2024,14 the agencies
announced an extension of the
resolution plan submission deadline for
the triennial full filers from July 1, 2024,
to March 31, 2025. At this time, the
agencies are further extending the 2025
resolution plan submission deadline for
triennial full filers to October 1, 2025,
to provide the firms with sufficient time
to develop their full resolution plans in
light of the final guidance. The agencies
are also clarifying that all triennial full
filers’ subsequent resolution plan
submission, a targeted resolution plan,
are due on or before July 1, 2028, and
that future resolution plan submissions
will be due every three years after that,
alternating between full and targeted
resolution plans, pursuant to the Rule,15
unless the agencies exercise their
authority under the Rule to alter the
submission date for future resolution
plan submissions.16
Resolution Plan Strategy
Foreign-based covered companies
subject to the Rule have adopted one of
two resolution strategies for their U.S.
operations: (1) a single point of entry
(SPOE) strategy where only the top tier
U.S. material entity holding company
enters resolution through a bankruptcy
proceeding; or (2) a multiple point of
entry (MPOE) strategy where multiple
U.S. material entities enter separate
resolution proceedings, including any
top tier U.S. material entity holding
company enters bankruptcy, any U.S.
material entity IDI subsidiary enters
resolution pursuant to the Federal
Deposit Insurance Act of 1950, as
amended (the FDI Act), and other
entities enter the appropriate resolution
regimes or are wound down. The U.S.
SPOE and U.S. MPOE resolution
strategies that firms have chosen present
different risks and entail different types
of planning and development of
capabilities; accordingly, the proposal
contained content applicable to U.S.
SPOE resolution strategies and separate
content applicable to U.S. MPOE
resolution strategies.
Commenters supported inclusion of
expectations for both U.S. MPOE and
U.S. SPOE resolution strategies, and
supported firms’ ability to choose either
14 https://www.federalreserve.gov/newsevents/
pressreleases/bcreg20240117a.htm; https://
www.fdic.gov/news/press-releases/2024/
pr24002.html.
15 12 CFR 243.4(b) and 381.4(b).
16 12 CFR 243.4(d)(2) and 381.4(d)(2).

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strategy. However, some commenters
questioned whether the agencies were
expecting or encouraging firms to adopt
a U.S. SPOE resolution strategy and
recommended that the agencies disclose
publicly whether they prefer a
particular resolution strategy and engage
in notice and comment rulemaking if
they do. For firms that change
resolution strategies, some commenters
requested that the agencies provide a
transition period and made statements
about the preferred length of such a
transition period, and one asked for an
explanation for how a firm that is
changing strategies can satisfy the
agencies’ expectations, and others
requested that the agencies not issue
any findings regarding a firm’s first
resolution plan that adopts a different
resolution strategy.
The agencies do not prescribe a
specific resolution strategy for any firm.
This guidance, similarly, does not
suggest that any firm should change its
resolution strategy, nor are the agencies
identifying a preferred strategy for a
specific firm or set of firms. The
selection of a preferred strategy,
including U.S. MPOE or U.S. SPOE as
a preferred resolution strategy, should
reflect the characteristics of the firm and
its business operations, and support the
goal of the resolution plan to
substantially mitigate serious adverse
effects of the firm’s failure on financial
stability in the United States. Each firm
remains free to choose the resolution
strategy it believes would most
effectively facilitate a rapid and orderly
resolution.
The agencies are providing separate
guidance for a U.S. SPOE resolution
strategy and a U.S. MPOE resolution
strategy in acknowledgment that firms
are free to adopt the resolution strategy
that best suits their operations and
organizations. Further, the agencies note
there may be resolution strategies other
than U.S. SPOE and U.S. MPOE that
could facilitate a rapid and orderly
resolution. The specified firms should
continue to submit resolution plans
using the resolution strategies they
believe would be most effective in
achieving an orderly resolution of their
firms. Regardless of strategy, a
resolution plan should address the key
vulnerabilities, support the underlying
assumptions required to successfully
execute the chosen resolution strategy,
and demonstrate the adequacy of the
capabilities necessary to execute the
selected strategy.
Moreover, because the agencies do not
prescribe resolution strategies, firms
may voluntarily change their preferred
strategy in the future. However,
reflecting the voluntary nature of

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resolution strategy changes, the agencies
do not anticipate providing a transition
period during which a firm would be
free from potential findings under the
Rule while it effectuates a change in
resolution strategy, whether from U.S.
MPOE to U.S. SPOE, or to any other
resolution strategy. A firm controls the
timing of when it submits its first plan
with a different strategy; accordingly, it
can take the time it needs to put in place
the resources and capabilities needed to
submit a plan that satisfies the standard
in section 165(d) of the Dodd-Frank Act
and the Rule. The standard of review for
a resolution plan submission of a firm
that transitions to a new strategy is
therefore the same as for any firm
subject to the Rule.17
B. Connection to Other Rulemakings

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Long-Term Debt Proposal
The agencies, as well as the Office of
the Comptroller of the Currency
(together with the agencies, the Federal
banking agencies), issued in August
2023 a proposed rule for comment that
would require certain large holding
companies, U.S. intermediate holding
companies of FBOs, and certain IDIs, to
issue and maintain outstanding a
minimum amount of long-term debt
(LTD), among other proposed
requirements.18 The agencies have
received comments on the LTD
proposal, and will consider all
comments received in context of the
LTD rulemaking. The agencies
requested comments on the proposed
guidance that take the LTD proposal
into consideration.
One commenter recommended that,
for purposes of their resolution plans,
firms should only assume their existing
outstanding LTD and not the projected
LTD that would be in place once the
firm has achieved full compliance with
the LTD proposal. Another commenter
argued that the agencies should
consider the interaction between the
proposed guidance and LTD proposal,
with a goal of having them work
together to improve the resolvability of
applicable banking organizations and
avoid duplicative or contradictory
requirements. The commenter also
asserted that calibration of an IDI’s
internal LTD requirement could lead
banking organizations using a U.S.
17 See

12 CFR 243.8 and 381.8.

MPOE resolution strategy to adopt a
U.S. SPOE resolution strategy because of
the costs of compliance with such
internal LTD issuance.
The Federal banking agencies have
not finalized the LTD rulemaking as of
the issuance of this final guidance. The
agencies recognize that LTD issued and
maintained by a specified firm could
affect the firm’s strategic analysis of the
funding, liquidity, and capital needs of,
and resources available to, the covered
company and its material entities.19
However, the agencies believe that the
finalization of a requirement to maintain
a specified amount of LTD would not
affect this guidance in any material way.
Any final LTD rule will address the
manner in which its requirements will
be implemented. This final guidance is
intended to convey the agencies’
expectations regarding the content of
resolution plan submissions, and not to
contradict, modify, or accelerate a
company’s obligations under other laws
or regulations. As provided in the final
guidance, firms should develop their
resolution plans in accordance with the
current state of the applicable legal and
policy frameworks. The agencies also
recognize, however, that there may be
phase-in periods during which rules
become effective. Should the LTD rule
be finalized in advance of October 1,
2025, the agencies will not expect firms
to incorporate the requirements of the
rule into their 2025 resolution plan
submissions. This should provide firms
covered by the LTD rule with reasonable
time to consider any final LTD rule in
a future resolution plan submission.
Further, and as noted above, the
agencies are not recommending that any
specified firm adopt any particular
strategy in response to this guidance or
the LTD proposal.
Basel III End Game Proposal and the
GSIB Capital Surcharge Proposal
The Federal banking agencies also
issued in July 2023 a proposed rule for
comment to substantially revise the
capital requirements applicable to large
banking organizations and to banking
organizations with significant trading
activity.20 The Board also issued a
proposed rule for comment to amend
the Board’s rule that identifies and
establishes risk-based capital surcharges

18 https://www.federalreserve.gov/newsevents/

pressreleases/bcreg20230829a.htm; https://
www.fdic.gov/news/press-releases/2023/
pr23065.html. See also Long-Term Debt
Requirements for Large Bank Holding Companies,
Certain Intermediate Holding Companies of Foreign
Banking Organizations, and Large Insured
Depository Institutions, 88 FR 64524 (Sept. 19,
2023) (LTD proposal).

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19 See

12 CFR 243.5(c)(1)(iii) and 381.5(c)(1)(iii).

20 https://www.federalreserve.gov/newsevents/

pressreleases/bcreg20230727a.htm; https://
www.fdic.gov/news/press-releases/2023/
pr23055.html. See also Regulatory Capital Rule:
Large Banking Organizations and Banking
Organizations With Significant Trading Activity, 88
FR 64028 (Sept. 18, 2023) (Capital proposal).

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for GSIBs.21 The latter proposal would
also amend the Systemic Risk Report
(FR Y–15), which is the source of inputs
to the implementation of the GSIB
framework under the capital rule.
One commenter asserted that the
issuance of multiple rulemaking and
guidance proposals limited the
commenter’s ability to evaluate and
comment on the proposed guidance.
The commenter also recommended that
the Federal banking agencies conduct an
analysis of the costs and benefits of
these proposals together. In addition,
the commenter recommended providing
the public more time to consider the
interactions of the various proposals.
Another commenter contended that the
agencies should provide additional
flexibility to firms that become triennial
full filers as a result of the GSIB Capital
Surcharge proposal and its associated
changes to the Systemic Risk Report (FR
Y–15). The commenter argued that such
triennial full filers should have an
extended transition period of two years
before taking into account the final
guidance.
The Federal banking agencies have
not finalized the LTD rulemaking,
Capital rulemaking, or GSIB Capital
Surcharge rulemaking as of the issuance
of this final guidance, and comments on
those proposed rules are currently
under consideration. The final guidance
does not rely on or presume the
finalization of these rulemakings and
instead states, as proposed, that a
resolution plan should be based on the
current state of the applicable legal and
policy frameworks.22 The agencies note
that the Federal banking agencies
extended the comment period on the
LTD rulemaking,23 the Capital
rulemaking,24 and the GSIB Capital
Surcharge rulemaking 25 to allow
interested parties more time to analyze
relevant issues and prepare their
comments. In addition, staff of the
agencies met with members of the
21 https://www.federalreserve.gov/newsevents/
pressreleases/bcreg20230727a.htm. See also
Regulatory Capital Rule: Risk-Based Capital
Surcharges for Global Systemically Important Bank
Holding Companies; Systemic Risk Report (FR Y–
15), 88 FR 60385 (Sept. 1, 2023) (GSIB Capital
Surcharge proposal).
22 See infra section V.X of this document.
23 Long-Term Debt Requirements for Large Bank
Holding Companies, Certain Intermediate Holding
Companies of Foreign Banking Organizations, and
Large Insured Depository Institutions; Extension of
Comment Period, 88 FR 83364 (Nov. 19, 2023).
24 Regulatory Capital Rule: Large Banking
Organizations and Banking Organizations with
Significant Trading Activity; Extension of Comment
Period, 88 FR 73770 (Oct. 27, 2023).
25 Risk-Based Capital Surcharges for Global
Systemically Important Bank Holding Companies;
Systemic Risk Report (FR Y–15); Extension of
Comment Period, 88 FR 73772 (Oct. 27, 2023).

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public—including those who asked for
additional time to review the various
proposals—at the request of those
persons after the close of the comment
period. Moreover, the Board collected
data from the banks affected by the
Capital rulemaking to further clarify the
estimated effects of the proposal.26 The
FBO guidance proposal also included an
analysis of potential burden of the
proposal pursuant to the Paperwork
Reduction Act.27 As discussed below,
the agencies did not receive any
comment on that section of the
proposal.28
The agencies also note that the Rule
establishes a transition period for new
covered companies that become
triennial full filers.29 As discussed
elsewhere in this document, a specified
firm is only expected to take into
account the guidance for the resolution
plan submission that is due at least 12
months after the date the firm becomes
a specified firm.30

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FDIC IDI Resolution Plan Proposal
The agencies received two comments
on the connection between the proposal
and the IDI Rule.31 The FDIC published
proposed revisions to the IDI Rule on
September 19, 2023,32 and published
final revisions on July 9, 2024.33 One
commenter recommended coordinating
aspects of the proposed guidance and
the Proposed IDI Rule, including having
consistent terms and concepts, and
permitting cross-referencing to section
165(d) resolution plans under the
Proposed IDI Rule. Another commenter
suggested aligning the Rule and the IDI
Rule to reduce the combined
compliance burden.
The Rule requires a covered company
to submit a resolution plan that would
allow for the rapid and orderly
resolution of the firm under the
Bankruptcy Code in the event of
material financial distress or failure.
The final guidance clarifies the
agencies’ expectations regarding certain
topics and provides direction as to how
26 https://www.federalreserve.gov/newsevents/
pressreleases/bcreg20231020b.htm.
27 See proposed guidance at 88 FR 64648–49.
28 See infra section IV of this document.
29 See 12 CFR 243.4(b)(5) and 381.4(b)(5).
30 See infra section III.B of this document.
31 12 CFR 360.10 (IDI Rule).
32 Resolution Plans Required for Insured
Depository Institutions With $100 Billion or More
in Total Assets; Informational Filings Required for
Insured Depository Institutions With at Least $50
Billion But Less Than $100 Billion in Total Assets,
88 FR 64579 (Sept. 19, 2023) (Proposed IDI Rule).
33 Resolutions Plans Required for Insured
Depository Institutions with $100 Billion or More
in Total Assets; Informational Filings Required for
Insured Depository Institutions With at Least $50
Billion but Less Than $100 Billion in Total Assets,
89 FR 56620 (July 9, 2024).

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a covered company may demonstrate its
compliance with its statutory obligation
under section 165(d) of the Dodd-Frank
Act to develop a resolution plan
allowing for its rapid and orderly
resolution. The IDI Rule serves a
different purpose: the IDI Rule assists
the FDIC in preparing to manage the
resolution of a covered insured
depository institution. While these two
rules may be complementary, they are
not the same. Additionally, whether to
align the Proposed IDI Rule with the
Rule or permit cross-referencing to
section 165(d) resolution plans under
the IDI Rule is outside the scope of this
guidance.
C. Proposed Guidance
On August 29, 2023, the agencies
invited public comment on proposed
guidance for how foreign triennial full
filers’ resolution plans could address
key challenges in resolution, which was
proposed to apply beginning with the
subject firms’ 2024 resolution plan
submissions.34 The proposal identified
the banking organizations to which the
guidance would apply and articulated
several areas of guidance: group
resolution plan; capital; liquidity;
governance mechanisms; operational;
legal entity rationalization and
separability; branches; and IDI
resolution, if applicable. The proposed
guidance described the agencies’
proposed expectations for each of these
areas. Most substantive topics were
bifurcated, with separate guidance for a
U.S. SPOE resolution strategy and a U.S.
MPOE resolution strategy. The proposed
guidance concluded with information
about the format and structure of a plan
that applied equally to plans
contemplating either a U.S. SPOE
resolution strategy or a U.S. MPOE
resolution strategy.
The proposed guidance for firms that
adopt a U.S. SPOE resolution strategy
was generally based on the 2020 FBO
Guidance or the associated proposal.35
The proposed guidance for firms that
adopt a U.S. MPOE resolution strategy
was based upon the 2020 FBO Guidance
but modified to be pertinent to U.S.
MPOE resolution strategies. The
agencies also proposed to clarify their
expectations for specified firms that
adopt a U.S. MPOE resolution strategy
that includes the resolution of a material
entity that is a U.S. IDI.
The agencies invited comments on all
aspects of the proposed guidance. The
agencies also specifically requested
34 Supra

note 12.
for Resolution Plan Submissions of
Certain Foreign-Based Covered Companies, 85 FR
15449 (March 18, 2020) (2020 Proposed FBO
Guidance).
35 Guidance

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66513

comments on a number of issues,
including the utilization of a U.S. SPOE
resolution strategy by FBOs, the
interaction of resolution guidance with
a final long-term debt rule, the
interaction between U.S. and global
resolution strategies, the amount of time
between the publication of the final
guidance and the firms’ next resolution
plans, the appropriateness of guidance
on IDI resolution, and whether to issue
derivatives and trading expectations.
II. Overview of Comments
The agencies received and reviewed
eight comment letters on the proposed
guidance. Commenters included various
financial services trade associations and
two public interest groups. In addition,
the agencies met with representatives of
a banking organization that would be a
specified firm and trade associations
that represents banking organizations at
their request to discuss issues relating to
the proposed guidance.36 This section
provides an overview of the general
themes raised by commenters. The
comments received on the proposed
guidance are further discussed below in
the sections describing the final
guidance (and, in some cases,
previously in section I), including any
changes that the agencies have made to
the proposed guidance in response to
comments.
Differentiating Expectations Based on
Size, Complexity, and Risk
Most commenters contended that the
proposed guidance did not sufficiently
differentiate expectations among firms
subject to resolution planning guidance.
Several commenters argued that the
specified firms have reduced their
activities in the United States, resulting
in a reduced risk and financial stability
profile, and that expectations be
adjusted accordingly. Some commenters
also recommended that foreign triennial
full filers without intermediate holding
companies (IHCs) should not be covered
by the guidance or should be the subject
of guidance tailored to their risk
profiles. In contrast, one commenter
contended that the proposed guidance
favors the U.S. MPOE resolution
strategy by including fewer expectations
for firms that adopt that strategy and
recommended that the guidance for
such firms be more aligned with
36 Summaries of those meetings and copies of the
comments can be found on each agency’s website.
https://www.federalreserve.gov/apps/foia/
ViewComments.aspx?doc_id=OP-1817&doc_ver=1;
https://www.fdic.gov/resources/regulations/federalregister-publications/2023/2023-guidanceresolution-plan-submissions-foreign-triennial-3064za38.html.

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guidance for resolution plan filers using
a U.S. SPOE resolution strategy.
In addition, some commenters argued
that section 165 of the Dodd-Frank Act
requires the agencies to tailor
application of prudential standards
issued pursuant to that section, such as
resolution planning guidance;
contended that the proposal was too
similar to the 2019 U.S. GSIB Guidance
or 2020 Proposed FBO Guidance; and
encouraged expectations in the final
guidance to be further differentiated
based on size, risk and other factors.
Several commenters also objected to
expectations in the proposal that were
proposed in the 2020 Proposed FBO
Guidance but not finalized in the 2020
FBO Guidance—including guidance on
group resolution plans, resolution
capital adequacy and positioning
requirements (RCAP), resolution
liquidity adequacy and positioning
(RLAP), governance mechanisms, and
separability—and contended that the
agencies did not adequately explain
their rationale for adopting expectations
different from those in the 2020 FBO
Guidance.

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Resolution Strategy and Transition
Period
Several commenters supported the
proposal’s inclusion of expectations for
both U.S. MPOE and U.S. SPOE
resolution strategies and the agencies’
statement that firms have the ability to
choose their preferred strategy.
However, as noted above, some
commenters questioned whether the
agencies were expecting or encouraging
firms to adopt a U.S. SPOE resolution
strategy. For firms that change
resolution strategies, some commenters
requested that the agencies provide a
transition period during which the
agencies would not make credibility
findings in connection with a plan
review, and one commenter requested
that the agencies explain how a firm
that is changing strategies can satisfy the
agencies’ expectations.
Interaction Between U.S. and Group
Resolution Planning
Some commenters disagreed with the
proposed guidance relating to the
interaction of the U.S. and the global
resolution plans. Commenters claimed
that global resolution plans are
sometimes written by home authorities
and FBOs may not always have full
visibility into the details of those plans’
assumptions, strategies, and necessary
capabilities. These commenters also
asserted that, in some countries, home
country regulators may consider aspects
of the group plan to be confidential
supervisory information and,

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accordingly, the global resolution plan
is not shared with the firm beyond very
general terms. In addition, one
commenter contended that the proposal
did not specify with sufficient detail
what information from a group
resolution plan should be included in
the U.S. resolution plan. Commenters
urged the agencies to coordinate with
home country authorities and to use
Crisis Management Groups (CMGs),
which are designed for collaboration
between international regulators, to
obtain this type of information.
Capital and Liquidity
The agencies received a number of
comments on the capital and liquidity
sections of the proposed guidance. With
regard to the capital section of the
proposed guidance, most commenters
argued that the proposal included
expectations that are duplicative of
existing capital requirements and
suggested removing the guidance on
RCAP from the final guidance; one
commenter, however, supported
including RCAP expectations in final
guidance. One commenter suggested
that RCAP expectations would increase
the complexity of the resolution
planning process and another
commenter expressed concern that
RCAP expectations could result in
excessive capital placement in the U.S.,
which could prevent firms from
effectively positioning capital in times
of stress.
With regard to the liquidity section of
the proposed guidance, commenters
suggested there is redundancy between
the proposal and certain regulatory
requirements and also recommended
removing the guidance on RLAP from
the final guidance; one commenter,
however, supported including RLAP
expectations in final guidance. One
commenter expressed concern that
RLAP expectations could make it more
difficult for the specified firm’s parent
to deploy liquidity resources most
effectively in stress. In addition, one
commenter requested that the final
guidance strengthen expectations for
liquidity in resolution by including a
procedure or protocol for liquidity
related decisions, irrespective of
resolution strategy.
IDI Resolution Analysis
The agencies received a number of
comments on the proposed guidance
related to the resolution of a subsidiary
material entity U.S. IDI. Multiple
commenters requested clarity on how
the firm’s plan should address the
expectations regarding the FDIC’s
statutory least-cost requirement and
questioned whether there is sufficient

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information available for firms to
effectively evaluate whether a proposed
resolution plan would satisfy the leastcost analysis expectations. These
commenters also questioned whether
the least-cost analysis would be of value
to FDIC in an actual resolution and
argued that the guidance should be
aligned with the requirements of the IDI
Rule. One stated sufficient time should
be given for firms to conduct new
analyses and seek additional guidance
from the agencies and that aspects of
this section of the proposal should not
be finalized.
One commenter asked the agencies to
consider the compliance burden of the
guidance, while another commenter
argued that firms should not be
expected to demonstrate that their
preferred strategy would be consistent
with the FDIC’s statutory least-cost
requirement. Another commenter
suggested that the agencies should
require firms to develop resolution
strategies involving bridge depository
institutions (BDIs) and recommended
that the guidance address the value of
assets transferred to such a BDI, how the
resolution plan would address the IDI’s
franchise value, and how the preferred
resolution strategy would result in a
least-costly resolution.
Derivatives and Trading
Some commenters supported not
including derivatives and trading
expectations, stating it was appropriate
to exclude such guidance because the
specified firms have limited derivatives
and trading portfolios, particularly
relative to the U.S. G–SIB banking
organizations covered by such guidance.
However, some other commenters
supported including such expectations
in the final guidance, contending that
derivatives activity for foreign triennial
full filers may increase in the future and
proposed applying such guidance to
firms with net derivatives exceeding a
given threshold.
Connection to Other Rules
The agencies received a number of
comments about the interaction of the
proposed guidance with several other
rulemaking initiatives by the Federal
banking agencies. For example, some
commenters recommended coordinating
the FDIC’s Proposed IDI Rule revisions
with the resolution plan rule and final
guidance for the specified firms. Several
commenters also suggested that the
agencies consider the interaction
between the proposed guidance and the
LTD proposal to ensure the two
proposals work together to improve the
resolvability of applicable banking
organizations and avoid duplicative or

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contradictory requirements. Some
commenters expressed concern that
including certain expectations in the
final guidance, such as those relating to
capital, would be premature before
finalizing the Capital proposal and LTD
proposal, which impact firms’ capital
planning. Further, some commenters
recommended that the Federal banking
agencies analyze the costs and benefits
of these proposals together.

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Timing of Next Resolution Plan
Several comments discussed the
timing of the next resolution plan
submission and its relationship to this
final guidance. Some commenters
recommended providing at least one
year between issuing final guidance and
the deadline for foreign triennial full
filers’ next resolution plan submissions.
However, other commenters suggested
that six months from publication of the
final guidance to the first resolution
plan submission would be adequate for
firms to take into account the guidance.
III. Final Guidance
After considering the comments,
conducting additional analysis, and
further assessing the business and risk
profiles of foreign triennial full filers,
the agencies are issuing final guidance
that includes certain modifications and
clarifications from the proposal. In
particular, the capital, group resolution
plan, operational, assumptions, and IDI
resolution sections of the final guidance
reflect changes from the proposed
guidance. In addition, as was noted in
the proposal,37 the final guidance
consolidates all prior resolution
planning guidance for the firms in one
document and clarifies that any prior
guidance not included in the final
guidance has been superseded. Further,
as was noted in the proposal,38 the final
guidance is not intended to override the
obligation of an individual firm to
respond in its next resolution plan
submission to pending items of
individual feedback or any
shortcomings or deficiencies jointly
identified or determined by the agencies
in that firm’s prior resolution plan
submissions. The guidance is drafted to
reflect the current conditions in the
industry and institutions as they exist
today.
As discussed below,39 several
commenters asserted that the proposal
did not adequately differentiate among
covered companies based on their size,
complexity, and risk to financial
stability. The guidance, however, takes
37 See

proposed guidance at 88 FR 64644.
id.
39 See infra section III.M of this document.
38 See

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into account the size and complexity of
firms, their resolution strategy, and
whether they are based in the United
States or in a foreign jurisdiction. In
addition, the final guidance is not meant
to limit firms’ consideration of
additional vulnerabilities or obstacles
that might arise based on a firm’s
particular structure, operations, or
resolution strategy.
The agencies also note that
commenters described certain
expectations that are set forth in the
guidance as ‘‘requirements.’’ As the
agencies indicated in the proposed
guidance and are now reaffirming, the
final guidance does not have the force
and effect of law. Rather, the final
guidance outlines the agencies’
supervisory expectations regarding each
subject area covered by the final
guidance.40 The final guidance includes
language reflecting this position.41
Finally, the agencies made several
minor, non-substantive changes from
the proposal, including to align the
wording of guidance directed at firms
that adopt an SPOE resolution strategy
and firms that adopt an MPOE
resolution strategy.
A. Scope of Application
The agencies proposed applying the
guidance to all foreign-based triennial
full filers and invited comment on all
aspects of the proposed scope of the
guidance. Multiple commenters argued
that foreign triennial full filers without
IHCs should not be covered by the
guidance or should be the subject of
guidance tailored to their risk profiles.
In making this suggestion, one
commenter stated that, unlike domestic
firms, the resolution of U.S. operations
of FBOs is anticipated to occur as part
of the home country resolution and the
IHC threshold represents a materiality
threshold for understanding the
importance of the U.S. operations and
for resolution planning. The commenter
also stated that separate guidance could
be proposed for foreign triennial full
filers without an IHC. Several
commenters further argued that the
specified firms are already subject to
enhanced requirements in both the U.S.
and their home jurisdictions, and that
the firms are smaller, better capitalized,
and present a much-reduced risk to U.S.
financial stability relative to category I
firms. One commenter also contended
that imposing additional resolution
planning expectations would
undermine these firms’ ability to
support U.S. capital markets while
40 See 12 CFR 262.7 and appendix A to 12 CFR
part 262; 12 CFR part 302.
41 See infra section V.I of this document.

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another commenter argued that the
guidance should place greater reliance
on cooperation among international
regulators.
After review and consideration of
these comments, the agencies are
finalizing this section of the guidance as
proposed. The agencies are issuing
expectations to these firms to help them
further strengthen their resolution plans
based on the agencies’ recent experience
with UBS Group AG’s acquisition of CS
and, with respect to specified firms with
large subsidiary IDIs, the resolutions of
SVB, SB, and First Republic. Like CS,
many of the specified firms are foreign
GSIBs with a large presence in the
United States. The guidance covers large
FBOs both with and without a U.S. IHC
and covers the entirety of their U.S.
operations. The final guidance will
strengthen these firms’ resolution plans
for their U.S. operations, while allowing
flexibility based on the characteristics of
individual firms and their respective
resolution strategies. The agencies note
that some aspects of the guidance may
not be relevant to banking organizations
without a U.S. IHC and do not expect
firms to include in their resolution
plans information about topics that do
not relate to the structure of their
operations. More generally, the level of
detail in firms’ resolution plans about
specific topics and vulnerabilities
should reflect the importance of those
activities to the firm and whether they
relate to or support any identified
critical operations or core business lines
or are material to the execution of the
resolution strategy.
In many cases, the preferred
resolution outcome for U.S. operations
would be successful execution of the
home country’s global resolution
strategy and the agencies have
developed guidance to clarify the
interactions between firms’ U.S. and
global resolution strategies. The home
country resolution planning
requirements do not make the guidance
unnecessary for these firms. The Rule
requires FBOs to submit plans providing
for the rapid and orderly resolution of
their U.S. subsidiaries and operations 42
under the Bankruptcy Code in the event
of their failure. The agencies are issuing
guidance to assist FBO firms in
enhancing the resolution plans required
under U.S. law.
B. Transition Period
The proposed guidance did not
describe how the guidance would be
applied to FBOs that become covered by
its scope, but it did request comment on
all aspects of the proposed scope of
42 See

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application. To provide certainty to
FBOs, the final guidance states that
when an FBO becomes a specified firm,
the final guidance will apply to the
firm’s next resolution plan submission
with a submission date that is at least
12 months after the time the firm
becomes a specified firm.43 If a specified
firm ceases to be a foreign triennial full
filer, it will no longer be considered a
specified firm, and the guidance will no
longer be applicable to that firm as of
the date the firm ceases to be a foreign
triennial full filer.
C. Interaction With Group Resolution
Plan
The agencies recognize that the
preferred resolution outcome for many
specified firms is a successful home
country resolution using a global SPOE
resolution strategy that does not involve
the placement of any U.S. material
entities into resolution. However, by
law, section 165(d) resolution planning
provisions require relevant FBOs to
contemplate their resolution in the
United States. U.S. operations of an FBO
are often highly interconnected with the
broader, global operations of the
financial institution. To clarify the
interaction between U.S. and global
resolution strategies, the proposal
outlined expectations that specified
firms should describe the impact of
executing the firm’s global, group-wide
resolution plan on the firm’s U.S.
operations and detail the extent to
which resolution planning under the
Rule relies on different assumptions,
strategies, and capabilities from the
global plan. The group resolution plan
section of the proposed guidance
differed from a similarly named section
of the 2020 Proposed FBO Guidance by
focusing on how U.S. resolution
planning is integrated into a FBO’s
global resolution planning efforts, in
addition to describing the impact on
U.S. operations of executing the global
plan. In 2020, the agencies declined to
finalize that aspect of the 2020 Proposed
FBO Guidance, stating that the item was
addressed by the Rule and that the
agencies would collaborate with home
country regulators to better understand
the impact on U.S. operations of
executing a firm’s group resolution
plan.44 However, recent events have
underscored the need to better
understand group resolution plans, and
particularly the impact of executing the
home plan on U.S. operations. These
events, combined with prior resolution
43 The plan type for that next submission remains
as specified by the Rule, i.e., a full or targeted
resolution plan. See 12 CFR 243.4 and 381.4.
44 See 2020 FBO Guidance at 85 FR 83567.

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plan submissions from the specified
firms that did not provide consistent
and sufficient details regarding the
integration of U.S. resolution planning
with the firm’s group resolution
planning process, prompted the
agencies to issue additional guidance.
Moreover, the final guidance differs
from the 2020 Proposed FBO Guidance
in several ways by further clarifying the
Rule expectation and focusing on the
reliance between U.S. and group
resolution plans based on information
available to the firm, as described
below.
The agencies received several
comments regarding this section of the
proposal. Commenters claimed that
global plans are sometimes written by
home authorities and FBOs may not
always have full visibility into the
details of those plans’ assumptions,
strategies, and capabilities. Commenters
also asserted that, in some countries, the
global resolution plan is not shared with
the firm beyond very general terms and
that home country regulators may
consider aspects of the group plan to be
confidential supervisory information. In
addition, one commenter contended
that the proposal did not specify with
sufficient detail what information from
a group resolution plan should be
included in the U.S. resolution plan.
Commenters urged the agencies to
coordinate with home country
authorities and to use CMGs, which are
designed for collaboration between
international regulators, to obtain this
type of information.
After consultation with certain home
authorities and in response to these
comments, the agencies are finalizing
this section of the guidance with
revisions. First, the agencies recognize
that not all firms have access to the
group-wide resolution plan for that
financial institution. Accordingly, the
final guidance clarifies that firms are not
expected to provide information that
they do not possess and does not
include an expectation that firms
specifically identify the extent to which
resolution planning under the Rule
relies on different assumptions,
strategies, and capabilities from the
global plan. Furthermore, the agencies
note that while CMGs have been and
continue to be a useful forum for
collaboration between home and host
authorities regarding resolution related
topics, centralizing information about
group resolution plans in resolution
plans submitted under the Rule could
help the agencies prepare for a range of
outcomes and supplement ongoing
coordination with home country
authorities.

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Accordingly, the final guidance
provides that a plan should describe the
extent of reliance on U.S. operations for
executing the global resolution strategy
and any reliance on the home or parent
operations for executing the U.S.
resolution strategy. A description of
capabilities relied on to execute the U.S.
resolution strategy that differ from
capabilities to execute the global
resolution strategy should also be
included in a plan. The agencies also
have retained language from the
proposal that a specified firm’s broader
resolvability framework is expected to
consider the objectives of both the
group-wide resolution strategy and the
U.S. resolution strategy pursuant to the
Rule, with complementary efforts to
enhance resolvability across plans. The
agencies do not believe that inclusion of
this type of information about group
resolution plans in U.S. resolution
planning poses confidentiality issues,
and the agencies will collaborate with
home authorities to address any
outstanding issues regarding the
confidentiality of group resolution
plans. The agencies encourage specified
firms to bring specific confidentiality
concerns to the attention of the agencies
and their respective home authorities.
D. Capital
For specified firms using a U.S. SPOE
resolution strategy, the agencies
proposed capital expectations
substantially similar to those in the
2020 Proposed FBO Guidance. The
ability to provide sufficient capital to
material entities without disruption
from creditors is essential to a U.S.
SPOE resolution strategy’s objective to
ensure that material entities can
continue to maintain operations as the
firm is resolved. The proposal described
expectations concerning the appropriate
positioning of capital and other lossabsorbing instruments (e.g., debt that a
parent holding company may choose to
forgive or convert to equity) among the
material entities within the firm (RCAP).
The proposal also described
expectations regarding a methodology
for periodically estimating the amount
of capital that may be needed to support
each material entity after the bankruptcy
filing (resolution capital execution need,
or RCEN).
The agencies received numerous
comments on the capital section of the
proposed guidance. One commenter
supported including RCAP expectations
in the final guidance. Several
commenters, though, asserted that
RCAP would be duplicative of existing
capital requirements, such as total loss
absorbing capacity (TLAC) provisions,
and recommended that the agencies

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remove RCAP from the final guidance.
These commenters also contended that
the agencies did not sufficiently explain
why the agencies proposed guidance on
capital, including RCAP, when the
agencies previously considered
adopting RCAP expectations in the 2020
Proposed FBO Guidance but omitted
these expectations from the 2020 FBO
Guidance. A commenter argued that
existing capital requirements are
sufficient for the size and complexity of
the firms subject to this guidance
without RCAP expectations, which, the
commenter asserted, add more
complexity to the resolution planning
process. Another commenter expressed
concern that RCAP expectations could
result in excessive capital placement in
the U.S., and that this could prevent
firms from effectively positioning
capital in times of stress.
One commenter contended that as the
majority of IHCs subject to guidance are
required to hold local resources for the
recapitalization of their U.S. operations
under U.S. TLAC requirements, the
agencies should not issue additional
requirements related to local bail-in-able
resources. A commenter argued that the
risk characteristics of U.S. IHCs do not
justify requiring pre-positioning of
capital for U.S. IHC subsidiaries and
urged that, at a minimum, the agencies
should not implement both IDI-level
LTD requirements and RCAP
expectations for firms that select a U.S.
SPOE resolution strategy.
One commenter also asserted that
including expectations in this guidance
regarding the positioning of capital is
premature given that finalization of the
Capital proposal and the LTD proposal
may impact firms’ capital planning. A
commenter specifically pointed to
language in the LTD proposal in which
the agencies cite RCAP as one of the
reasons why IDI-level LTD requirements
are not necessary for the IDI subsidiaries
of U.S. GSIBs.
After reviewing these comments, the
agencies are finalizing this section of the
guidance largely as proposed, with one
clarification concerning RCEN. Whereas
the proposed guidance provided that to
the extent a firm’s U.S. resolution
strategy relies on the recapitalization of
U.S. non-branch material entities, such
recapitalization should be to a level that
allows for an orderly resolution of the
U.S. non-branch material entities, the
final guidance specifies that the
recapitalization should allow U.S. nonbranch material entities to operate or be
wound down in an orderly manner.
This change is intended to provide more
detail to firms to help them develop
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Although the agencies previously
pointed to TLAC requirements
applicable to U.S. IHCs as part of the
rationale for not including RCAP
expectations in the 2020 FBO
Guidance,45 the agencies believe RCAP
expectations are important for FBOs
adopting a U.S. SPOE resolution
strategy in order to ensure the
appropriate positioning of capital and
other loss-absorbing instruments among
the U.S. IHCs and all of their material
entity subsidiaries and to effectively
execute a U.S. SPOE resolution strategy.
Specifically, TLAC requirements apply
to the IHC, while RCAP expectations
under the guidance are applicable not
just at the IHC level, but between the
U.S. IHC and its material entity
subsidiaries. Further, resources required
to be held at the IHC consistent with
TLAC requirements may differ from the
firm’s expected resource needs to
execute a U.S. SPOE resolution strategy
at specific material entities. Plans
submitted by the specified firms would
benefit from the firm’s own assessment
of its resource positioning and the
resolution needs among its material
entities, not just the IHC or the IDI.
Further, the stress experienced by and
the failure of several large banking
organizations in March 2023 highlighted
the fast-moving nature of stress events,
as several banking organizations entered
resolution proceedings rapidly. These
events also highlighted the potential for
the failure of a large regional banking
organization to affect financial stability.
Successful execution of a U.S. SPOE
resolution strategy—including the need
to ensure that individual material
entities have adequate capital to
maintain operations as the firm is
resolved—is unlikely to be successful
under a short time frame without
advance planning. Appropriate
positioning of capital and other lossabsorbing instruments among the firm’s
material entities is an important element
of this advanced planning to reduce
uncertainty and enable timely
recapitalization consistent with a U.S.
SPOE resolution strategy. Accordingly,
the agencies are finalizing guidance that
includes RCAP expectations, despite not
including those expectations in the final
2020 FBO guidance, to support the
successful execution of the U.S. SPOE
resolution strategy.
Finalizing RCAP expectations is not
premature in light of outstanding
proposals such as the LTD rulemaking
and other pending rules because the
RCAP expectations can be achieved
with or without the LTD contemplated
in the LTD proposal. The Federal
45 See

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banking agencies have not finalized the
LTD rulemaking proposal as of the
issuance of this final guidance, and
comments on that proposed rule are
currently under consideration.
Specifically, the final guidance does not
rely on or presume the finalization of
pending rules and instead states,
consistent with the proposal, that a
resolution plan should be based on the
current state of the applicable legal and
policy frameworks.46 The guidance is
intended to assist firms in developing
their resolution plans, which are
required to be submitted pursuant to the
Dodd-Frank Act and the Rule. While
other capital and resolution-related
rules may establish minimum standards
applicable to firms submitting
resolution plans, this guidance is
designed to facilitate a firm’s own
analysis of the firm’s expected needs in
resolution across that firm’s material
entities.
Regarding the comment that RCAP
expectations would result in excessive
capital placement in the United States,
RCAP is not a regulatory requirement,
but rather a potential element of an
effective SPOE resolution strategy. The
specified firms are not required to adopt
a U.S. SPOE resolution strategy. To the
extent a specified firm selects a U.S.
SPOE resolution strategy, any reduction
in flexibility would be balanced by
benefits prepositioning provides in
reducing uncertainty and enabling
timely recapitalization of material
entities. Furthermore, the agencies’
reference to RCAP in the LTD preamble
as one reason for not proposing IDI-level
LTD requirements for U.S. GSIBs does
not provide a rationale for excluding
RCAP expectations from this guidance.
First, in addition to RCAP expectations,
the U.S. GSIBs are different in profile
from these firms, and are subject to the
most stringent capital, liquidity, and
other prudential standards of all
banking organizations that operate in
the United States. Second, as noted
above, the goals of this guidance would
be complemented by additional LTD
issued by specified firms, and the
guidance is practicable in the absence of
an LTD requirement.
For firms that adopt a U.S. MPOE
resolution strategy, the agencies did not
propose further expectations concerning
capital and asked a question about
whether capital-related expectations
should be applied. In response, one
commenter agreed with the proposal
that additional expectations are not
warranted for firms using a U.S. MPOE
resolution strategy, arguing that such
expectations would serve no purpose.
46 See

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However, another commenter
contended that it is not prudent to
assume that material entities within a
holding company structure can be
discontinued in an orderly manner and
that, at a minimum, capital plans are
needed for each material entity to
preserve its value during the transition
period between a firm’s failure and
when it can be sold or closed in an
orderly way. The commenter asked the
agencies to reconsider expectations for
firms that adopt a U.S. MPOE resolution
strategy and align them with
expectations for firms that adopt a U.S.
SPOE resolution strategy.
The agencies have determined that
additional capital expectations for firms
selecting a U.S. MPOE resolution
strategy are not necessary at this time.
Under a U.S. MPOE resolution strategy,
most material entities do not continue
as going concerns upon the firm’s entry
into resolution proceedings and are
likely to have already depleted existing
capital requirements. Accordingly, the
agencies are finalizing this section of the
guidance as proposed.
E. Liquidity
For firms that adopt a U.S. SPOE
resolution strategy, the agencies
proposed liquidity expectations
substantially similar to those in the
2020 Proposed FBO Guidance. A firm’s
ability to reliably estimate and meet its
liquidity needs prior to, and in,
resolution is important to the execution
of a firm’s resolution strategy because it
enables the firm to respond quickly to
demands from stakeholders and
counterparties, including regulatory
authorities in other jurisdictions and
financial market utilities. Maintaining
sufficient and appropriately positioned
liquidity also allows subsidiaries to
continue to operate while the firm is
being resolved in accordance with the
firm’s resolution strategy. For firms that
adopt a U.S. MPOE resolution strategy,
the agencies proposed that a firm should
have the liquidity capabilities necessary
to execute its resolution strategy, and its
plan should include analysis and
projections of a range of liquidity needs
during resolution.
The agencies received numerous
comments on the liquidity section of the
proposed guidance. One commenter
supported including RLAP expectations
in the final guidance for firms that adopt
a U.S. SPOE resolution strategy.
Several commenters, however,
requested that the agencies remove
RLAP expectations from the final
guidance, claiming that the expectation
is redundant to certain liquidity
requirements, such as the Liquidity
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Liquidity Stress Testing (ILST). Several
commenters also argued FBOs have
reduced their activities in the United
States, resulting in a reduced risk and
financial stability profile, and that
liquidity requirements set forth in
existing regulatory requirements, and
not RLAP, should set the binding
constraint on the firms. In addition, one
commenter expressed concern that
RLAP expectations could make it more
difficult for the global firm to deploy
liquidity resources most effectively in
stress. Several commenters also asserted
that the agencies did not sufficiently
explain the rationale for including
RLAP expectations that the agencies had
previously considered but omitted from
the 2020 FBO Guidance.
Another commenter requested that for
firms that adopt a U.S. MPOE resolution
strategy, the guidance strengthen
expectations for liquidity in resolution
by including a procedure or protocol for
liquidity related decisions, irrespective
of resolution strategy. The commenter
argued that the guidance should identify
the importance of overcoming barriers
to moving liquidity across material legal
entities and clarify which types of
transfers of liquidity are permissible for
material entities in resolution.
After reviewing these comments, the
agencies are finalizing this section of the
guidance as proposed.47 While the
agencies previously did not adopt RLAP
expectations in the 2020 FBO Guidance,
the agencies’ recent experiences
highlighted the fast-moving nature of
bank failure and resolution and
underscored the need to maintain
sufficient and appropriately positioned
liquidity across the IHC and its
subsidiaries to be prepared for a
successful U.S. SPOE resolution
strategy. The agencies also believe that
RLAP expectations are appropriate in
light of recent events demonstrating that
liquidity pressures on these firms can
change dramatically over a short period
of time. Having sufficient and
appropriately positioned liquidity at the
time of failure increases the probability
that operating subsidiaries will have
enough liquidity to be able to continue
to operate while the firm is being
resolved, and the RLAP expectations
help achieve this goal.
RLAP expectations are not addressed
by ILST and other regulatory
requirements. Maintaining sufficient
and appropriately positioned liquidity
is critical to executing a U.S. SPOE
resolution strategy, regardless of the size
and complexity of the banking
47 The agencies are clarifying one aspect of RLAP
guidance that could be construed to impose a
requirement on the specified firms.

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organization. The LCR and ILST
requirements that commenters
referenced serve a different purpose—to
promote resilience of firms’ funding
profiles—and are not focused on
resolution planning.
RLAP expectations also would not
hinder a specified firm’s global parent
from deploying liquidity resources most
effectively in stress. Unlike ILST and
other regulatory requirements, RLAP is
not a regulatory requirement, but rather
an example of a decision-making
framework for liquidity needs and
positioning in support of an effective
SPOE resolution strategy that could be
consistent with effective resolution
planning. As discussed elsewhere, the
guidance is not a legally binding
enforceable requirement and is therefore
not a binding constraint, and the
specified firms are not required to adopt
a U.S. SPOE resolution strategy or
develop RLAP capabilities. To the
extent a specified firm adopts a U.S.
SPOE resolution strategy and uses
RLAP, any reduction in flexibility
would be balanced against the benefits
prepositioning provides in enabling
subsidiaries to continue to operate
while the firm is being resolved.
Finally, the agencies are not
establishing expectations for procedures
or protocols for liquidity related
decisions and clarifying the types of
transfers of liquidity that are
permissible for material entities in
resolution for firms that adopt a U.S.
MPOE strategy. The Rule already
includes requirements for firms to
include detailed descriptions of funding
and liquidity needs and resources of
material entities, and to identify
interconnections and interdependencies
related to liquidity arrangements.48
Beyond the assumptions specified in the
final guidance related to liquidity,
additional details of how each firm
provisions liquidity in the lead up to
and during resolution are not needed at
this time. Furthermore, firms should
follow procedures and protocols that are
aligned with their larger liquidity
management frameworks to facilitate
their preferred resolution strategies.
F. Governance Mechanisms
The agencies proposed separate
governance mechanisms expectations
based on a firm’s preferred resolution
strategy. Specified firms that use an
SPOE resolution strategy would have
been expected to develop an adequate
governance structure with triggers that
identify the onset, continuation, and
increase of financial stress to ensure that
48 12 CFR 243.5(c)(1)(iii) and (g) and
381.5(c)(1)(iii) and (g).

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there is sufficient time to prepare for
resolution-related actions. For specified
firms that adopt a U.S. MPOE resolution
strategy, the agencies proposed
providing governance mechanisms
expectations to ensure communication
and coordination between the governing
body of the U.S. operations and the
foreign parent.
The agencies requested comment on
whether to apply additional governance
mechanisms expectations to firms
contemplating a U.S. MPOE resolution
strategy. One commenter called for the
agencies to apply similar expectations
regardless of a firm’s preferred
resolution strategy, arguing that many
aspects of resolution planning are the
same or similar for U.S. MPOE and U.S.
SPOE resolution strategies. The
commenter also encouraged the
agencies to adopt expectations that
firms articulate their internal legal
strategy, processes for making key
decisions, and roles and responsibilities
leading up to and after bankruptcy.
Another commenter argued in favor of
not providing any governance
mechanisms guidance to firms adopting
a U.S. MPOE resolution strategy.
Other commenters called on the
agencies to limit the expectations for
firms adopting a U.S. SPOE resolution
strategy. These commenters contended
that expectations should not apply to a
specified firm that does not rely on
foreign support or transfer of
prepositioned resources during runway
or resolution, and that the expectations
as proposed were too prescriptive or
burdensome. One commenter requested
that the agencies clarify why
expectations (for foreign parent support,
triggers, and support within the United
States) in the 2020 Proposed FBO
Guidance but were not finalized were
included in the proposed guidance for
FBOs that adopt a U.S. SPOE resolution
strategy.
The agencies are finalizing this
section of the guidance as proposed.49
For firms that adopt a U.S. MPOE
resolution strategy, the governance
mechanisms guidance already includes
expectations regarding the role of U.S.
board and senior management under the
U.S. resolution strategy as well as
expectations regarding triggers and
other internal-decision-making
processes relating to the decision to
49 As noted above, the agencies made several
minor, non-substantive changes from the proposal,
including to align the wording of guidance directed
at firms that adopt a U.S. SPOE resolution strategy
and firms that adopt a U.S. MPOE resolution
strategy. The agencies also provided one minor
clarifying example of an external stakeholder that
could be relevant for purposes of a governance
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implement the strategy. Adopting
expectations for the processes for
making key decisions, internal legal
strategy, and roles and responsibilities
would be duplicative. In addition,
under a U.S. MPOE resolution strategy,
certain material entities’ entry into
resolution is typically determined by or
dependent on the actions of supervisory
and resolution authorities. As a result,
additional expectations similar to those
included for a U.S. SPOE resolution
strategy (additional triggers, playbooks,
foreign parent support, and support
within the United States) would not
meaningfully improve the resolvability
of specified firms adopting a U.S. MPOE
resolution strategy.
Governance mechanisms expectations
for firms adopting a U.S. SPOE
resolution strategy are reasonable in
light of the events of March 2023. The
stress experienced by and the failure of
several large banking organizations in
March 2023 highlighted the potentially
fast-moving nature of bank resolution,
as several banking organizations entered
resolution proceedings rapidly. These
events also highlighted the potential for
the failure of a large regional banking
organization to affect financial stability.
Successful execution of a U.S. SPOE
resolution strategy—including the
timely escalation of information to both
U.S. IHC and foreign parent governing
bodies in order to mitigate
vulnerabilities and take corresponding
actions, and the transmission of
resources to and within an FBO’s U.S.
material entity subsidiaries—is unlikely
to be successful within a short time
frame without advance planning,
appropriate governance structures and
processes, and assessment of possible
impediments, legal or otherwise.
Accordingly, in contrast to the 2020
FBO Guidance, this final guidance
contains governance mechanisms
expectations related to foreign parent
support, triggers, and support within the
United States for specified firms
adopting a U.S. SPOE resolution
strategy. Because the Rule requires firms
to contemplate resolution under the
Bankruptcy Code, resolution-specific
triggers facilitating communication and
coordination are appropriate to promote
resolvability even if a firm monitors and
controls capital and liquidity and
operations in business-as-usual (BAU)
and if the preferred strategy of an FBO
is a successful home country resolution.
The agencies note that firms’ BAU
processes and procedures may be
relevant to, and could inform, such
resolution capabilities.
In addition, while a firm may
understand the current legal risks
associated with its preferred resolution

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strategy under the Bankruptcy Code,
commercial and bankruptcy law and
precedent evolve, and it is important
that a firm’s plan reflect an up-to-date
assessment of possible legal challenges
and potential mitigants. The expectation
that a resolution plan includes such an
analysis of potential challenges does not
constrain firms’ ability to determine the
particular form and structure of the
framework developed to support its
particular resolution strategy and needs.
The agencies also note that the guidance
only relates to an analysis of planned
support; there are no expectations that
a plan should provide for such support.
Regarding the provision of foreign
support or transfer of prepositioned
resources during runway or resolution,
it should be noted that neither the final
guidance nor the Rule endorses a
specific mechanism for the provision of
such support. Instead, a firm that adopts
a U.S. SPOE resolution strategy should
explain in its resolution plan how it will
meet its U.S. resource needs, such as
through prepositioning, parent support,
and other options.
G. Operational
For firms that adopt a U.S. SPOE
resolution strategy, the agencies
proposed adopting portions of the
operational expectations of the 2020
FBO Guidance, 2020 Proposed FBO
Guidance, and SR letter 14–1,50 with
modifications based on the specific
characteristics and complexities of the
specified firms. The proposal contained
expectations on payments, clearing, and
settlement activities (PCS); managing,
identifying, and valuing collateral;
management information systems;
shared and outsourced services; and
qualified financial contracts (QFC). For
firms that adopt a U.S. MPOE resolution
strategy, the agencies proposed
expectations based on SR letter 14–1
and the 2020 FBO Guidance that are
most relevant to a U.S. MPOE resolution
strategy. As noted in the proposal,
development and maintenance of
operational capabilities is important to
support and enable execution of a firm’s
preferred resolution strategy, including
providing for the continuation of
identified critical operations and
preventing or mitigating adverse effects
on U.S. financial stability. The failure of
several large banking organizations in
March 2023 highlighted the importance
of firm capabilities to generate timely
and accurate data on a material entity
basis. For example, having the ability to
50 SR letter 14–1, ‘‘Principles and Practices for
Recovery and Resolution Preparedness’’ (Jan. 24,
2014), available at: https://www.federalreserve.gov/
supervisionreg/srletters/sr1401.htm.

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produce a list of key management and
support employees at the legal entity
level is critical both to continue
operations pursuant to a U.S. SPOE
resolution strategy and to facilitate the
work of resolution authorities in a U.S.
MPOE resolution strategy. As a result, in
a change from the 2020 FBO Guidance,
the agencies proposed and are now
finalizing management information
systems guidance for both U.S. SPOE
and U.S. MPOE resolution strategies.
The agencies also proposed, in a change
from the 2020 FBO Guidance, and are
now finalizing guidance on QFCs for the
U.S. SPOE resolution strategy, as not all
firms subject to the final guidance are
subject to the QFC stay rules of the
Board, Office of the Comptroller of the
Currency, and the FDIC.51
The Agencies received three
comments on the proposed guidance.
One commenter suggested that the
proposed guidance related to
management information systems,
qualified financial contracts, and shared
and outsourced services should help
strengthen the specified firms’
operational readiness. Another
commenter argued that the proposed
guidance’s expectation that MPOE firms
remediate vendor arrangements to
support continuity of shared and
outsourced services is overbroad. The
commenter asserted that this
expectation is inappropriate for MPOE
firms that mostly receive external
services through its IDI because
termination of such vendor contracts
due to ipso facto clauses would be
stayed by the FDI Act,52 and as many
firms include resolution-resilient terms
in vendor contracts when those
contracts undergo periodic review and
renewal. The commenter recommended
that the Agencies specify that this
expectation would apply only to
contracts not covered by the FDI Act
stay. Another commenter contended
that firms with limited PCS activities,
such as firms without identified critical
operations related to those activities,
should not have to develop the same
capabilities as firms with more complex
PCS activities.
After review and consideration of
these comments, the agencies are
finalizing this area of the guidance with
one clarification applicable only to
firms that adopt a U.S. SPOE strategy,
and one modification applicable to
firms with either U.S. resolution
strategy. The proposed guidance for
firms that adopt a U.S. SPOE strategy
51 See 12 CFR part 47 (Office of the Comptroller
of the Currency); 12 CFR part 252, subpart I (Board);
and 12 CFR part 382 (FDIC).
52 See 12 U.S.C. 1821(e)(13)(A).

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stated that a firm should maintain a
fully actionable implementation plan to
ensure the continuity of shared services
that support identified critical
operations or core business lines.
Implied in the concept of supporting
identified critical operations or core
business lines is the notion that a firm
would need to be able to execute its
resolution strategy. Accordingly, the
final guidance for firms that adopt a
U.S. SPOE strategy explicitly states that
a firm’s implementation plan to ensure
continuity of shared services should
include those services that are material
to the execution of the firm’s resolution
strategy.
The agencies recognize that firms
anticipate relying on external parties for
the execution of some aspects of the
resolution strategy, and the proposal
included and the final guidance
maintains the expectation that a firm
identify and support the continuity of
outsourced services that support critical
operations or are material to the
execution of the U.S. resolution strategy.
Such outsourced services that firms may
rely on could be employing outside
bankruptcy counsel and consultants to
help prepare documents needed to file
for bankruptcy, and to represent the
firm during the course of the bankruptcy
proceedings. The agencies expect that
covered companies engage in advance
planning to help facilitate their ability
to complete all filings, motions,
supporting declarations and other
documents to prepare for and file an
orderly resolution in bankruptcy. In
recognition of this expectation, the final
guidance clarifies that—regardless of
strategy—those professionals’ services
could be material to the execution of a
firm’s U.S. resolution strategy and, if so,
should be accounted for in the firm’s
resolution plan. Accordingly, the
agencies expect that firms should
prepare during business-as-usual to
ensure they can complete and file all
documents needed to initiate their
preferred resolution strategy.
The other aspects of this section of the
guidance are being finalized as
proposed. The comment addressing
contract remediation correctly observes
that the FDI Act permits the FDIC as
receiver of a failed IDI to enforce
contracts with that IDI notwithstanding
any provisions in the contract
permitting termination due to
insolvency or appointment of the
receiver. However, it is advantageous for
contracts that support identified critical
operations or that are material to the
execution of the resolution strategy to
not purport to permit termination.
Counterparties may not be aware of the
receiver’s authority under the FDI Act to

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enforce such agreements, potentially
requiring the receiver to seek authority
from a court to compel the
counterparty’s performance, which
could lead to interruption of identified
critical operations and capabilities
needed to execute the resolution
strategy. Further, counterparties located
overseas may not recognize the
authority afforded the receiver to
compel the performance of contracts.
The agencies recognize that contract
remediation is an ongoing process and
encourage firms to make such changes
proactively.
Regarding PCS activities, as discussed
elsewhere,53 the Agencies note that the
level of detail provided in a firm’s plan
should be both consistent and
commensurate with the firm’s risk and
activities.
H. Legal Entity Rationalization and
Separability
For foreign banking organizations that
adopt a U.S. SPOE resolution strategy,
the agencies proposed substantively
adopting legal entity rationalization
(LER) expectations from the 2020 FBO
Guidance and separability expectations
from the 2020 FBO Proposed Guidance.
The LER expectations stated that firms
should maintain a structure that
facilitates orderly resolution of their
operations, including by developing and
describing criteria that consider the best
alignment of legal entities and business
lines and facilitate resolvability of U.S.
operations. The separability
expectations provided that firms should
identify discrete U.S. operations that
could be sold or transferred in
resolution under a range of potential
failure scenarios. The agencies declined
to finalize the separability expectations
in the 2020 Proposed FBO Guidance,
stating that the agencies had found that
the separability options within the
United States were few, their inclusion
in resolution plans had yielded limited
new insights, and the agencies expected
that such information would be
obtainable through international
collaboration with home country
regulators.
For FBOs that adopt a U.S. MPOE
resolution strategy, the agencies
proposed adopting LER expectations
that were reduced relative to the 2020
FBO Guidance and separability
expectations that were similarly
reduced relative to the 2020 FBO
Proposed Guidance. The LER
expectations clarified that these firms
should have legal entity structures that
support their U.S. resolution strategy
and describe these structures in their
53 See

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plans, as well as discuss their rationale
for the legal entity structure in cases
where a material entity IDI relies on
other affiliates during resolution. The
separability expectations requested that
firms include options for the sale,
transfer, or disposal of significant assets,
portfolios, legal entities, or business
lines in resolution.
The agencies received two comments
on the separability guidance for foreign
banking organizations. One commenter
contended that separability analysis is
inappropriate for businesses and legal
entities that would be wound down in
resolution, as it may not be feasible to
sell or otherwise transfer such
businesses, and that separability
analysis would not enhance
resolvability. The commenter further
noted that many elements of the
separability analysis may not be
appropriate for firms that are not active
in the investment banking space or lack
large mergers and acquisitions teams.
Another commenter called on the
agencies not to reimpose separability
expectations that had been proposed in
2020 but removed from the final 2020
FBO Guidance, instead suggesting that
the agencies obtain separability insights
through collaboration with home
country regulators.
After review and consideration of the
comments, the agencies are finalizing
this guidance as proposed. The
application of LER and separability
expectations to FBOs, whether they
adopt an SPOE or MPOE strategy,
remains appropriate because these firms
have significant non-bank or crossnational activities, as well as
interconnections among U.S. IHC
subsidiaries, U.S. branches, and the
foreign parent. The 2023 bank failures
highlighted the benefit of understanding
the separability options of U.S.
operations of FBOs, particularly for the
purpose of informing discussions with
foreign regulatory authorities regarding
the potential restructuring of an FBO’s
U.S. operations in resolution. While the
agencies continue to discuss firm
separability and other topics with home
country regulators, identification of
separability options for U.S. operations
and inclusion of supporting analysis in
resolution plans provides important
information to complement and
enhance ongoing international
coordination.
Finally, the agencies moved
expectations on LER governance
processes from the separability section
to the LER section of the guidance text.

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I. Insured Depository Institution
Resolution
Background
In the proposal, the agencies provided
clarifying expectations as to how a firm
adopting a U.S. MPOE resolution
strategy with a material entity IDI
should explain how the IDI can be
resolved under the FDI Act in a manner
that is consistent with the overall
objectives of the resolution plan. In
particular, the proposed expectations for
IDI resolution were designed to support
the resolution plans’ effectiveness in
substantially mitigating the risk that the
failure of the specified firm would have
serious adverse effects on financial
stability in the United States, while also
adhering to the legal requirements of the
FDI Act without relying on the
assumption that the systemic risk
exception will be invoked in connection
with the resolution of the firm. For
example, the agencies proposed
clarifying that if a firm adopting a U.S.
MPOE resolution strategy selects an IDI
resolution strategy other than a payout
liquidation, the firm’s plan should
provide information supporting the
feasibility of the firm’s selected strategy,
although such a feasibility analysis need
not consist of a full FDI Act least-cost
requirement analysis. The agencies
proposed that a firm could instead
provide a more limited analysis. The
proposal noted that the same
expectations would not be applicable to
firms adopting an SPOE resolution
strategy because the U.S. IDI
subsidiaries of such firms would not be
expected to enter resolution.
The agencies received a number of
comments on the proposed guidance
related to the resolution of a subsidiary
material entity U.S. IDI. Some
commenters requested additional clarity
on how the firm’s plan should address
the expectation that the plan include an
analysis of how the resolution strategy
could potentially meet the FDIC’s
statutory least-cost requirement. One
commenter suggested that the agencies
should require firms to develop
resolution strategies involving BDIs.
This commenter recommended that the
guidance address how firms could
describe and quantify the value of the
firm’s assets transferred to such a BDI,
and that the agencies should provide
guidance so that firms would address
how the resolution plan would
incorporate the value of the IDI’s assets
and liabilities, including its franchise
value, and how the preferred resolution
strategy would result in a least-costly
resolution. The commenter also
recommended that firms and regulators

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reach agreement on certain assumptions
regarding valuations.
Another commenter argued that firms
adopting a U.S. MPOE strategy should
not be expected to demonstrate that
their preferred strategy would be
consistent with the FDIC’s statutory
least-cost requirement. This commenter
stated that efforts to conduct a
hypothetical least-cost requirement
analysis, or a proxy for that analysis,
would be of no or minimal value to the
FDIC in an actual resolution event. The
commenter claimed that it would not be
possible to conduct a least-cost test
requirement analysis in a resolution
plan submission in the absence of actual
bids from actual buyers. Instead, the
commenter recommended that the
guidance provide expectations for how
firms selecting a U.S. MPOE strategy
could demonstrate their valuation
capabilities. The commenter also
suggested that because a least-cost
requirement analysis is not a component
of the Proposed IDI Rule, it also should
not be a component of the guidance.
This commenter requested sufficient
time to address any finalized guidance
that provides expectations for including
least-cost requirement analysis.
Several commenters suggested that
the Proposed IDI Rule is a better forum
to address how the IDI subsidiary of a
specified firm selecting a U.S. MPOE
strategy can be resolved under the FDI
Act in a manner that is consistent with
the FDI Act. Several commenters also
suggested that the agencies’
expectations for resolution plan
submissions under the Rule should
align with the requirements of the
FDIC’s IDI Rule plan submissions.
One commenter questioned whether
firms have sufficient information about
how the FDIC would conduct a leastcost test analysis in order for a firm to
conduct an analysis of whether its
preferred strategy could meet the FDIC’s
statutory least-cost requirement. This
commenter stated that meeting the
expectations in the proposal would
involve significantly more detail and
comparative analysis than the IDI Rule,
and that, in order to prevent
inconsistency and undue burden, the
guidance should instead follow the IDI
Rule so that firms can reference their IDI
Rule submissions when preparing and
submitting resolution plans under the
guidance to reduce duplication and
increase consistency.
When an IDI fails and the FDIC is
appointed receiver, the FDIC generally
must use the resolution option for the
failed IDI that is least costly to the DIF
of all possible methods (the least-cost

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requirement).54 A resolution plan that
contemplates the separate resolution of
a U.S. IDI that is a material entity and
the appointment of the FDIC as receiver
for that IDI should explain how the
resolution could be achieved in a
manner that adheres to applicable law,
including the FDI Act, and that would
achieve the overall objectives of the
resolution plan. Prior resolution plans
that have addressed the resolution of the
IDIs in MPOE strategies have sometimes
included resolution mechanics that are
not consistent with the FDI Act,
including inappropriate assumptions
that uninsured deposits could
automatically be transferred to a BDI.
Separate and distinct from the Rule,
the FDIC has a regulation, the IDI Rule,
requiring certain IDIs (covered IDIs or
CIDIs) to submit to the FDIC resolution
plans providing information about how
the CIDI can be resolved under the FDI
Act. Contemporaneous with publication
of the proposed guidance, the FDIC
published in the Federal Register the
Proposed IDI Rule, a proposed
rulemaking to amend and restate the IDI
Rule, which has since been finalized
and was published in the Federal
Register on July 9, 2024.
The IDI Rule and the Rule each have
different goals, and, accordingly, the
expected content of the respective
resolution plans is different. The
purpose of the IDI Rule is to ensure that
the FDIC has access to the information
it needs to resolve a CIDI efficiently in
the event of its failure, including an
understanding of the CIDI’s ability to
produce the information the FDIC
would need to conduct a least-cost
determination under a wide range of
circumstances.
The Rule serves a different purpose.
The Rule requires a covered company to
submit a resolution plan that would
allow rapid and orderly resolution of
the subsidiaries and operations of a
foreign covered company that are
domiciled in the United States under
the Bankruptcy Code in the event of
material financial distress or failure.
54 See 12 U.S.C. 1823(c)(4)(A). A deposit payout
and liquidation of the failed IDI’s assets (payout
liquidation) is the general baseline the FDIC uses in
a least-cost requirement determination. See 12
U.S.C. 1823(c)(4)(D). An exception to this
requirement exists when a determination is made
by the Secretary of the Treasury, in consultation
with the President and after a written
recommendation from two-thirds of the FDIC’s
Board of Directors and two-thirds of the Board, that
complying with the least-cost requirement would
have serious adverse effects on economic
conditions or financial stability and implementing
another resolution option would avoid or mitigate
such adverse effects. See 12 U.S.C. 1823(c)(4)(G). A
specified firm should not assume the use of this
systemic risk exception to the least-cost
requirement in its resolution plan.

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The regional bank failures in March
2023 demonstrated that banking
organizations of size and complexity
similar to that of the specified firms—
or even smaller and less complex
banking organizations—can be
disruptive to U.S. financial stability. In
the case of Silicon Valley Bank and
Signature Bank, uninsured depositors
would have faced the potential for
significant losses had the least costly
approach to resolution, a payout
liquidation, been adopted. The potential
for contagion from the deposit runs at
the firms that failed, as well as related
potential for risks to the economy and
financial stability, led the Secretary of
the Treasury, in consultation with the
President and after a written
recommendation from the FDIC’s Board
of Directors and the Board, to invoke the
systemic risk exception to enable the
FDIC to resolve these institutions in a
way that would avoid or mitigate
serious adverse effects on economic
conditions or financial stability. Though
a specified firm would be conducting its
analysis without input in the form of
actual bids from potential buyers, the
agencies expect firms to use available
information to estimate the value of its
franchise for purposes of conducting the
limited least-cost analysis articulated in
the guidance.
If a firm’s resolution plan under the
Rule that includes a U.S. MPOE strategy
calls for resolving an IDI using a strategy
other than payout liquidation, the plan
should explain how the requirements of
the FDI Act could be met without
depending upon extraordinary
government support. Even though this
analysis is not binding in an actual
resolution scenario, an analysis showing
that the firm’s preferred resolution
strategy could satisfy requirements of
the FDI Act could help the firm
demonstrate that the resolution plan’s
preferred strategy could be executed in
a manner consistent with applicable
law. If a resolution plan does not
provide such an explanation, it may be
appropriate to conclude that the strategy
would not satisfy the FDI Act’s relevant
provisions, such as the least-cost
requirement, which could represent a
weakness in the plan. As a general
matter, the agencies followed this
practice in reviewing previous full
resolution plan submissions.
Guidance. In response to commenters,
the agencies are providing additional
detail to help address commenters’
questions related to the FDI Act’s leastcost requirement and how it relates to
the expectations in this final guidance.
The final guidance does not express a
change in the agencies’ expectations.
Instead, the final guidance provides

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more detail on approaches a firm can
use to explain how the resolution of its
IDI subsidiary can be achieved in a
manner that substantially mitigates the
risk that the firm’s failure would have
serious adverse effects on U.S. financial
stability while also complying with the
statutory and regulatory requirements
governing IDI resolution. The final
guidance lists a number of different
common strategies for resolving an IDI
and describes the kind of information
that a firm could provide to explain how
a resolution using one of the example
strategies could be consistent with the
least-cost requirement. The final
guidance also provides information
about calculating the value of an IDI’s
assets and its franchise value. Finally,
the final guidance explicitly notes that
the agencies are not expecting a firm to
provide a complete least-cost analysis.
Strategies for Resolving an IDI
Purchase and Assumption
Transaction. The FDIC typically seeks
to resolve a failed IDI by identifying,
before the IDI’s failure, one or more
potential acquirers so that as many of
the IDI’s assets and deposit liabilities as
possible can be sold to and assumed by
the acquirer(s) instead of remaining in
the receivership created on the failure
date.55 This transaction form, termed a
purchase and assumption or P&A
transaction, has often been the
resolution approach that is least costly
to the DIF, and is usually considered the
easiest for the FDIC to execute and the
least disruptive to the depositors of the
failed IDI—particularly in the case of
transactions involving the assumption
of all the failed IDI’s deposits by the
assuming institution (an all-deposit
transaction).
The limited size and operational
complexity present in most small-bank
failures have been significant factors in
allowing the FDIC to execute P&A
transactions with a single acquirer on
numerous occasions. Resolving an IDI
via a P&A transaction over the closing
weekend, however, has not always been
available to the FDIC, particularly in
failures involving large IDIs. P&A
transactions require lead time to
identify potential buyers and allow due
diligence on, and an auction of, the
failing IDI’s assets and banking
business, also termed its franchise. The
acquiring banks must also have
sufficient excess capital to absorb the
failed IDI’s assets and deposit franchise,
sufficient expertise to manage business
integration, and the ability to comply
55 See generally https://www.fdic.gov/resources/
resolutions/bank-failures/ for background about the
resolution of IDIs by the FDIC.

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with several legal requirements. Larger
failed banks can pose significant, and
potentially systemic, challenges in
resolutions that make a P&A transaction
less viable. These challenges include: a
more limited pool of potential acquirers
as a failed IDI increases in size;
operational complexities that require
lengthy advance planning on the part of
the IDI and the FDIC; the development
of certain expertise; potential market
concentration and antitrust
considerations; and potentially the need
to maintain the continuity of activities
conducted in whole or in part in the IDI
that are critical to U.S. financial
stability.
Alternative Resolution Strategies. If
no P&A transaction that meets the leastcost requirement can be accomplished
at the time an IDI fails, the FDIC must
pursue an alternative resolution
strategy. The primary alternative
resolution strategies for a failed IDI are
(1) a payout liquidation, or (2)
utilization of a BDI.
Payout Liquidation. The FDIC
conducts payout liquidations by paying
insured deposits in cash or transferring
the insured deposits to an existing
institution or a new institution
organized by the FDIC to assume the
insured deposits (generally, a Deposit
Insurance National Bank or DINB). In
payout liquidations, the FDIC as
receiver retains substantially all of the
failed IDI’s assets for later sale, and the
franchise value of the failed IDI is lost.
A payout liquidation is often the most
costly and disruptive resolution strategy
because of this destruction of franchise
value and the FDIC’s direct payment of
insured deposits.
Bridge Depository Institution. If the
FDIC determines that temporarily
continuing the operations of the failed
IDI is less costly than a payout
liquidation, the FDIC may organize a
BDI to purchase certain assets and
assume certain liabilities of the failed
IDI.56 Generally, a BDI would continue
the failed bank’s operations according to
business plans and budgets approved by
the FDIC and carried out by FDICselected BDI leadership. In addition to
providing depositors continued access
to deposits and banking services, the
BDI would conduct any necessary
restructuring required to rationalize the
failed IDI’s operations and maximize
value to be achieved in an eventual sale.
56 Before a BDI may be chartered, the chartering
conditions set forth in 12 U.S.C. 1821(n)(2) must
also be satisfied. For purposes of this guidance, if
the Plan provides appropriate analysis concerning
the feasibility of the BDI strategy, there is no
expectation that the resolution plan also
demonstrates separately that the conditions for
chartering the BDI have been satisfied.

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Subject to the least-cost requirement,
the initial structure of the BDI may be
based upon an all-deposit transaction, a
transaction in which the BDI assumes
only the insured deposits, or a
transaction in which the BDI assumes
all insured deposits and a portion of the
uninsured deposits. Once a BDI is
established, the FDIC seeks to stabilize
the institution while simultaneously
planning for the eventual exit and
termination of the BDI. In exiting and
terminating a BDI, the FDIC may merge
or consolidate the BDI with another
depository institution, issue and sell a
majority of the capital stock in the BDI,
or effect the assumption of the deposits
or acquisition of the assets of the BDI.57
While utilizing a BDI can avoid the
negative effects of a payout liquidation,
such as destruction of franchise value,
many of the same factors that challenge
the feasibility of a traditional P&A
transaction also complicate planning for
the termination of a BDI through a sale
of the whole entity or its constituent
parts.
Though one commenter suggested
that the guidance should require firms
to develop resolution strategies
involving BDIs, the agencies do not
maintain an expectation that firms will
develop resolution strategies involving
BDIs. The expectations provided in this
guidance are also intended to be helpful
to firms that have chosen to involve a
BDI in their resolution strategy.
Least-Cost Analysis for Resolution
Plans. The final guidance does not
include an expectation that firms
provide in their resolution plans a
complete least-cost analysis. Such an
analysis would, for example, include a
comparison of the preferred strategy for
resolving an IDI that is a material entity
against every other possible resolution
method. While a firm may choose to
provide a complete least-cost analysis,
this guidance discusses expectations
regarding a limited least-cost analysis
that would explain how the firm’s
preferred U.S. strategy is not more
costly than a payout liquidation and, if
applicable, an insured-only BDI.
One commenter suggested that the
agencies should provide guidance for
how firms should address the valuation
of an IDI’s assets and liabilities,
including its franchise value. In this
final guidance, the agencies are
providing additional explanation for
how firms can develop and support the
valuation of the IDI’s assets and
liabilities in an IDI resolution. This
guidance includes a description of how
firms can assess the franchise value of
a firm’s business.
57 12

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Example. The following example
should be read in conjunction with
section VIII of the guidance text, Insured
Depository Institution Resolution. This
example is only intended to provide
firms with an illustration of the types of
considerations and calculations that
could be included in a firm’s analysis
explaining how its preferred strategy
would be less costly than a payout
liquidation and, if applicable, an
insured-only BDI. This example is not
intended to serve as a template for firms
or to provide guidelines for reasonable
valuations of a firm’s assets or
liabilities. The valuations described in
this example are intended to be
illustrative and are not guidance about
the likely values of a firm’s assets and
liabilities in an individual resolution
plan or in resolution.
Bank A has $500 billion in total
assets, consisting of $250 billion loans;
$75 billion cash and equivalents; $125
billion in investment securities; and
other assets totaling $50 billion. The
bank’s initial funding structure consists
of $400 billion in deposits; $25 billion
in various unsecured payables and debt;
$25 billion in secured funding; and $50
billion in capital instruments. For this
example, the bank assumes it would
encounter idiosyncratic events at a time
when severely adverse economic
conditions are present and this
combination of events would cause the
bank to be closed by the chartering
authority and the FDIC appointed as
receiver. The illustrative tables below
reflect values as of the appointment of
the FDIC as receiver.
The initial events combine to cause
immediate losses of $25 billion
recognized as direct operating charges
and $15 billion through write-downs/
provision expense for the loan portfolio,
and $60 billion of deposit runoff occurs.
• For purposes of conducting the
analysis, the firm’s management
assumes that additional value
diminution is present in the loan
portfolio. Accordingly, after thoroughly
analyzing the quality of its loan
portfolio and determining the potential
for additional credit losses, as well as
considering the market value of the loan
portfolio based upon the type of loans
it holds in comparison with comparable
sales transactions, and after further
considering sensitivity testing,
management supports an estimate near
$175 billion for the loan portfolio.
• In developing its Resolution Plan,
the firm’s management further supports
that $40 billion of additional deposit
runoff would occur in addition to the
initial $60 billion. At the time of failure,
Bank A’s remaining $300 billion of
deposits are 60 percent insured and 40

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percent uninsured. The ratio of insured
deposits to uninsured deposits is used
to calculate the pro rata recovery of
depositors and the losses imposed on
the DIF as a result.58
• The deposit runoff is assumed to be
met by using $50 billion of cash and
selling $50 billion of investment

securities. The remaining $75 billion
investment portfolio is entirely invested
in short-term U.S. Treasury securities
with an estimated value of $70 billion.
• The other assets are implicated in
the initial idiosyncratic loss. These
other assets include fixed assets,
foreclosed property, intellectual

property, and miscellaneous items with
a market value of $25 billion.
• As shown in table 1, the Plan
provides an analysis of the payout
liquidation strategy. This strategy
includes an expected loss to the DIF of
$18 billion.

TABLE 1—ILLUSTRATION OF BANK A PAYOUT LIQUIDATION—COST ESTIMATE
[dollars in billions]
Liquidation market value

Payout liquidation liability claim and amount recovered

Category

Value

Category

Loans .........................................................
Securities ...................................................

$175
70

Cash ...........................................................
Other ..........................................................

25
25

Total ....................................................

295

Claim

Secured Claims .........................................
Deposits Insured .......................................

Recovery/(loss)
$25
180

$25/($0)
$162/($18)

FDIC incurs the loss for the insured deposits so that all insured deposits are fully
repaid.
Deposits Uninsured ...................................
Unsecured Claims/Debt ............................
Equity Holders ...........................................

120
25
........................

$108/($12)
$0/($25)
No recovery

Loss to Deposit Insurance Fund (to make whole insured depositors) = $18 billion 59
Losses to uninsured depositors = $12 billion.

• However, the Plan also asserts and
supports that the payout liquidation
approach fails to reflect the franchise
value of the combined deposit and loan
relationships stemming from
considerations such as the low
administrative costs associated with
servicing large deposits, the elimination
of significant customer acquisition

costs, the stable fee income stream
associated with the accounts due to
barriers to entry for certain products,
and the importance and value of
integrating the loan and deposit
products.
• The Plan calculates, and provides
the analysis supporting the calculation,
that the economic benefit of packaging

these benefits together in an all-deposit
BDI is $20 billion, which is reflected as
a bid premium to liquidation pricing in
table 2.
• The result is that the all-deposit BDI
is less costly to the DIF than liquidation
because of the inclusion of the bid
premium.

TABLE 2—ILLUSTRATION OF BANK A PREFERRED STRATEGY—COST ESTIMATE
[dollars in billions]
All deposit bridge market value
Category

All deposit bridge bank liability claim and amount recovered
Value

Category

Claim

Secured Claims .........................................
Deposits Insured .......................................

Recovery/(loss)

Loans .........................................................
Securities ...................................................

$175
70

$25
180

Cash ...........................................................
Other ..........................................................

25
25

Sub Total ....................................................
Bid Premium ..............................................

295
20

Deposits Uninsured ...................................
Unsecured Claims/Debt ............................

120
25

Total ....................................................

315

Equity Holders ...........................................

........................

$25/($0)
$174/($6)

FDIC incurs the loss for the insured deposits so that all insured deposits are fully
repaid.
$116/($4)*
$0/($25)
No recovery

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Loss to Deposit Insurance Fund (to make whole insured and uninsured depositors) = $10 billion, which is less than the payout liquidation
loss.60
* Losses to uninsured depositors total $4 billion and are absorbed by the DIF.

J. Derivatives and Trading Activities
The agencies requested comment on
whether to provide derivatives and
trading activities guidance for specified
firms that adopt a U.S. SPOE or MPOE
resolution strategy. Some commenters
58 See

infra note 60.
(1) $295 billion asset value less
secured claim of $25 billion = $270 billion available
to depositors and junior claims; (2) $270 billion
available spread pro-rata across $300 billion
depositor class; 60 percent insured deposits and 40
59 Calculation:

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argued that no derivatives and trading
guidance is needed for foreign triennial
full filers because they have limited
derivatives and trading portfolios,
particularly relative to the U.S. GSIB
banking organizations covered by such

guidance. These commenters also noted
that not all of the biennial filers, which
are Category I firms, are subject to this
type of guidance. These commenters
also argued that if the agencies adopt

percent uninsured deposits; (3) $270 billion × .6 =
$162 billion paid to insured depositors; $270 billion
× .4 = $108 billion paid to uninsured depositors.
60 Calculation: (1) $315 billion asset value less
secured claim of $25 billion = $290 billion available
to depositors and junior claims; (2) $290 billion

available spread pro-rata across $300 billion
depositor class; 60 percent insured deposits and 40
percent uninsured deposits; (3) $290 billion × .6 =
$174 billion paid to insured depositors; $290 billion
× .4 = $116 billion paid to uninsured depositors.

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guidance on this topic, the agencies
should be careful to avoid
extraterritorial application of the
guidance and should use the derivatives
and trading expectations in the 2020
FBO Guidance for certain FBOs as a
model, rather than the expectations in
the 2020 Proposed FBO Guidance.
Other commenters supported
providing such guidance to foreign
triennial full filers, despite observing
that these firms engage in less activity
than the biennial filers. One commenter
cautioned that derivatives activities for
foreign triennial full filers may increase
in the future and proposed the inclusion
of an orderly-wind-down analysis for
firms with net derivatives exceeding a
given threshold. Another commenter
recommended that the guidance include
expectations for: roles and
responsibilities in derivatives unwind,
plan reporting regarding derivatives
exposures, plan risk assessments in
cross-border activity, barriers to swift
unwind of derivatives activities booked
outside the United States, and
capabilities to generate detailed
derivative reports. This commenter also
argued that firms should specify plans
to wind-down between affiliates and
external counterparties, as well as
describe potential sale of some trading
positions.
After reviewing the comments and
considering the scope of derivatives and
trading activities of foreign triennial full
filers,61 the agencies determined that the
banking organizations that would be
specified firms have limited derivatives
and trading operations compared to the
subset of Category I firms that are the
subject of derivatives and trading
guidance. The agencies also note that
the Rule includes certain requirements
regarding derivatives and trading
activities with which all covered
companies—including foreign triennial
full filers—must comply, as well as the
overall requirement to provide a
strategic analysis describing the covered
company’s plan for orderly resolution.62
The agencies believe that for this set of
covered companies (including the two
firms that are in scope of the 2020 FBO
guidance), given their current activities,
the topic of derivatives and trading
61 See FR Y–15 Systemic Risk Report, 2nd quarter
2023 data. Publicly available at the National
Information Center, https://www.ffiec.gov/NPW. See
also Quarterly Report on Bank Trading and
Derivatives Activities—Third Quarter 2023.
Publicly available at https://www.occ.gov/
publications-and-resources/publications/quarterlyreport-on-bank-trading-and-derivatives-activities/
index-quarterly-report-on-bank-trading-andderivatives-activities.html.
See 12 CFR 243.2 and 381.2; 12 CFR 243.5(c) and
(e)(6)–(7), and 381.5(c) and (e)(6)–(7).
62 Id.

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activities is sufficiently addressed by
the Rule. The agencies are therefore
finalizing the guidance without
including expectations on derivatives
and trading activity for the specified
firms.
The agencies also recognize that
derivatives activity or risk for foreign
triennial full filers may change in the
future. The agencies may consider the
need for firm-specific derivatives and
trading expectations in the future for
specified firms that substantially
increase their derivatives and trading
activities or change in a way such that
having a strategy to wind-down their
derivatives portfolios is critical to their
resolvability.
K. Branches
The agencies received no comments
regarding the branches section of the
proposed guidance. The agencies are
finalizing the section as proposed.
L. Format and Structure of Plans;
Assumptions
This section of the proposal described
the agencies’ preferred presentation
regarding the format, assumptions, and
structure of resolution plans. Under the
proposal, plans would have been
expected to contain an executive
summary, a narrative of the firm’s
resolution strategy, relevant technical
appendices, and a public section as
detailed in the Rule. The proposed
format, structure, and assumptions were
generally similar to those in the 2020
FBO Guidance, except that the proposed
guidance reflected the expectations that
(a) a firm should support any
assumptions that it will have access to
the Discount Window and/or other
borrowings during the period
immediately prior to entering
bankruptcy and clarified expectations
around such assumptions, and (b) a firm
should not assume the use of the
systemic risk exception to the least-cost
test in the event of a failure of an IDI
requiring resolution under the FDI Act.
In addition, for firms that adopt a U.S.
MPOE resolution strategy, the proposal
included the expectation that a plan
should demonstrate and describe how
the failure event(s) results in material
financial distress of the firm’s U.S.
operations, including consideration of
the likelihood of the diminution the
firm’s liquidity and capital levels prior
to bankruptcy.
The final guidance also includes an
expectation contained in the 2019 U.S.
GSIB Guidance and 2020 FBO Guidance
regarding the parameters of economic
forecasting in resolution plan
submission. Those guidance documents
stated that a resolution plan should

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assume the Dodd-Frank Act Stress Test
(DFAST) severely adverse scenario for
the first quarter of the calendar year in
which a resolution is submitted is the
domestic and international economic
environment at the time of the firm’s
failure and throughout the resolution
process.63 While this assumption is
similar to a provision in the Rule,64 the
agencies believe it is important to
provide guidance to firms about the
timing of the required assumption in the
Rule. The Board provides DFAST
scenario information to the specified
firms through the Board’s public
website. As such, the information is
available to specified firms who
themselves or their IHC subsidiaries are
not subject to stress testing
requirements.65
The agencies received one comment
in response to a question posed
regarding assumptions related to
lending facilities, including the
Discount Window. The commenter
supported the proposed assumptions
guidance regarding these facilities and
recommended that the agencies
consider providing additional guidance
on the assumptions related to the
amount, timing, and limitations of
liquidity that might become available
from these sources. However, the
additional guidance requested by the
commenter is unnecessary, and the
agencies are finalizing this section of the
guidance as proposed with one
clarification. Specifically, the proposed
guidance regarding the relevant
assumption already includes references
to timing and limitations of liquidity
commensurate with the activities of
firms subject to the guidance.
As a clarification, the agencies have
added a reference to Federal Home Loan
Banks (FHLBs) as a type of borrowing
for which firms should provide support
in their resolution plans if they assume
access during the period immediately
prior to entering bankruptcy. The
agencies’ experiences in 2023 showed
that many IDIs depend heavily on FHLB
funding in times of stress and,
accordingly, the agencies expect firms to
be prepared to support any assumptions
around such reliance for resolution
planning purposes.
The agencies also received a comment
recommending that more of firms’
resolution plans be disclosed publicly to
promote market discipline and
specifically asking that the public
portion of resolution plans describe
63 2019 U.S. GSIB Guidance at 84 FR 1459; 2020
FBO Guidance at 85 FR 83578.
64 12 CFR 243.4(h)(1) and 381.4(h)(1).
65 https://www.federalreserve.gov/publications/
dodd-frank-act-stress-test-publications.htm.

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potential acquirers of operations in the
event of resolution. The Rule establishes
at a high-level the required content of
the public section of a resolution plan,66
and this final guidance clarifies the
agencies’ expectations with respect to
that section. The agencies are mindful
that the public disclosure of resolution
plans, which may contain private
commercial information, has both
benefits and drawbacks, and the
agencies believe that, at the moment, the
Rule—revisions to which are outside the
scope of this guidance—and the final
guidance appropriately balance
transparency with confidentiality.
In addition, the agencies received two
comments requesting clarification of the
definition of ‘‘material entity’’ as
applied to certain non-U.S. entities,
such as foreign offices, in order to
improve the alignment of U.S.
resolution planning with home country
strategies. In particular, the commenter
contended that an aspect of the
proposed guidance, which concerned
assumptions regarding material entities,
was inconsistent with the Rule. This
was not the agencies’ intent, and the
final guidance modifies the
assumption’s description of ‘‘material
entity’’ for consistency with the Rule by
adopting the language for that provision
in the final 2020 FBO Guidance.
The agencies are otherwise finalizing
this section of the guidance as
proposed.67 The agencies did not
receive any comments in response to the
proposal’s request for comments about
answers to frequently asked questions,
and the agencies have not included
those prior answers to frequently asked
questions because these prior answers
were in response to questions posed by
only a portion of the firms to which this
guidance is applicable and regarding
guidance with certain different
expectations.
M. Additional Comments

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Differentiating Resolution Plan
Guidance
The agencies received several general
comments about whether the
expectations in the proposal were
suitably modified from expectations
included in past resolution plan
guidance and whether the proposal
appropriately distinguished between
different types of triennial full filers.
Several commenters contended that the
66 12

CFR 243.11(c) and 381.11(c).
agencies also are clarifying one expectation
in the Financial Statements and Projections
subsection of the Format and Structure of Plans;
Assumptions section of the guidance that could be
construed to impose a requirement on the specified
firms.
67 The

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proposed guidance did not sufficiently
differentiate expectations among firms
subject to resolution planning guidance.
Some of these commenters specifically
claimed because the specified firms
have limited operations compared to the
U.S. GSIBs and have reduced the size
and complexity of their U.S. operations,
they should not be subject to similar
resolution planning guidance as the U.S.
GSIBs. One commenter argued that
section 165 of the Dodd-Frank Act
requires the agencies to differentiate the
content of the resolution planning
guidance; the proposal was too similar
to the 2019 U.S. GSIB Guidance; and
expectations for the specified firms
should be further differentiated based
on size, risk, and other factors. Another
commenter argued that the proposed
guidance favors the U.S. MPOE
resolution strategy by including fewer
expectations for firms that adopt that
strategy and recommended that the
guidance should be more aligned with
guidance for resolution plan filers using
a U.S. SPOE resolution strategy.
While the differentiation requirement
in section 165 of the Dodd-Frank Act
does not apply to this non-binding
resolution plan guidance, the guidance
differentiates among covered
companies, taking into consideration
their size, complexity, and other riskrelated factors; their resolution strategy,
whether SPOE or MPOE; and whether
they are domestic or foreign-based.
The thresholds and risk-based
indicators that form the basis of the riskbased category framework used by the
Rule are designed to take into account
an individual firm’s particular activities
and organizational footprint that may
present significant challenges to an
orderly resolution.68 The Rule, using
those categories, defines triennial full
filers as one cohort because the failure
of a Category II or III banking
organization could pose a threat to U.S.
financial stability. Banking
organizations in these two categories
often have similar characteristics, such
as organizational structures, and similar
resolution strategies that benefit from
similar resolution guidance.
Accordingly, the agencies believe the
guidance is equally appropriate for all
foreign Category II and III banking
organizations. In addition, as discussed
above, the regional bank failures in
March 2023 demonstrated that the
failure of banking organizations with
$100 billion to $250 billion in total
consolidated assets can be disruptive to
U.S. financial stability. For these
reasons, providing the guidance to
68 See 2019 Federal Register Publication at 84 FR
59197–201.

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foreign triennial full filers in that asset
range is appropriate to prevent or
mitigate risks to the financial stability of
the United States.
Guidance for specified firms that
adopt a U.S. SPOE resolution strategy is
differentiated relative to guidance for
Category I banking organizations (i.e.,
the 2019 U.S. GSIB Guidance), notably
with the absence of derivatives and
trading expectations, which are
applicable to most of the U.S. GSIBs,
and other operational guidance as well
as reduced separability expectations.
Other aspects of the U.S. SPOE guidance
are appropriately similar to the 2019
U.S. GSIB Guidance because the
successful execution of a U.S. SPOE
resolution strategy benefits from the
capabilities discussed in the guidance.
The guidance for firms that adopt a U.S.
MPOE resolution strategy includes
substantially simpler expectations,
relative to U.S. SPOE guidance and the
2019 U.S. GSIB Guidance, in the areas
of capital, liquidity, governance
mechanisms, operational, legal entity
rationalization and separability,
derivatives and trading expectations,
and PCS. Having simpler expectations
relative to U.S. SPOE guidance does not
necessarily mean a firm adopting a U.S.
MPOE strategy will encounter fewer
challenges developing its resolution
plans; regardless of the strategy chosen,
the firm is responsible for providing
adequate information and analysis to
demonstrate its plan will facilitate an
orderly resolution. Each firm remains
free to choose the resolution strategy it
believes would most effectively
facilitate an orderly resolution, and the
agencies are not suggesting that any firm
change its resolution strategy, nor do the
agencies identify a preferred strategy for
a specific firm or set of firms.69
Finally, resolution plan guidance for
Category II and III banking organizations
is adapted to whether a covered
company is based in the United States
or in a foreign jurisdiction, with
dedicated guidance documents for each
type of firm. The Rule differentiates
between banking organizations based on
home jurisdiction,70 and whether a
banking organization is based in the
United States can significantly impact
its resolution strategy, resolution
capabilities, and resolution planning.
Accordingly, expectations for domestic
and foreign-based triennial full filers are
differentiated in the areas of capital,
liquidity, governance mechanisms,
69 See Section I.A Resolution Plan Strategy for
further discussion about why the agencies are
differentiating expectations depending on whether
a firm adopts a U.S. SPOE or U.S. MPOE resolution
strategy.
70 See 12 CFR 243.5(a) and 381.5(a).

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shared services, separability, branches,
and group-wide resolution plans.

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Relation to the 2020 Proposed FBO
Guidance and 2020 FBO Guidance
Two commenters asserted that the
agencies did not adequately explain
why the proposal contained certain
expectations the agencies had included
in the 2020 Proposed FBO Guidance but
declined to adopt in the 2020 FBO
Guidance. One of these commenters also
contended that the agencies did not
adhere to certain administrative law
requirements to identify and justify the
proposed changes in expectations,
particularly given that the agencies
recently adopted the 2020 FBO
Guidance. The proposal adequately
identified and explained the proposed
changes in resolution planning
expectations,71 and the guidance is
permissible under section 165(d) of the
Dodd-Frank Act and the Rule. However,
to promote transparency in the
guidance-making process, the agencies
have further clarified areas in which
and explained why the final guidance
differs from the 2020 FBO Guidance and
adopts certain expectations proposed in
the 2020 Proposed FBO Guidance.72
The agencies also considered whether
the 2020 FBO Guidance engendered
reliance interests among the banking
organizations that were the subject of
that guidance. The agencies received no
comments explicitly identifying such
reliance interests; the 2020 FBO
Guidance, like the current guidance, did
not have the force and effect of law; and
the 2020 FBO Guidance was applicable
for only one resolution plan submission
cycle, and only three banking
organizations were within the scope of
application of the 2020 FBO Guidance
for the 2021 targeted plan submission
(and one such banking organization no
longer exists). Accordingly, the agencies
believe that resolvability improvements
that may arise from issuing this
guidance outweigh any reliance
interests generated by the 2020 FBO
Guidance.
General Comments About the Proposal
The agencies received several general
comments about resolution planning
guidance. The agencies have considered
these commenters’ input but have made
no modifications to the final guidance.
One commenter expressed support for
the proposed guidance, in part because
it reaffirms that bankruptcy is the
preferred resolution strategy and would
improve the quality of resolution plan
71 See proposed guidance at 88 FR 64641, 64644–
45, 47.
72 See sections III.C–L of this document.

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submissions through enhanced
information and assumptions, better
enabling the resolution of a specified
firm in an orderly manner. Another
commenter praised the agencies’
proposal for providing needed clarity
and transparency on expectations for
specified firms’ resolution plans, and for
making several improvements that will
improve specified firms’ resolution
plans.
Another commenter recommended
that the agencies adopt the content of
the guidance in the form of a legally
binding and enforceable rule, in part
due to the size and scope of specified
firms, the importance of resolution
planning, and the financial stability
implications involved. This commenter
also suggested that the large bank
failures in 2023 demonstrated the need
for improvement in banking
organizations’ resolution planning and
the agencies’ process for assessing these
plans.
Resolution planning is important to
U.S. financial stability; however, the
agencies have not made changes to the
guidance in response to these
comments. The Rule, which is legally
enforceable, identifies the specific
topics that must be addressed in
resolution plans. In contrast, resolution
plan guidance outlines the agencies’
supervisory expectations and priorities
and articulates the agencies’ general
views regarding appropriate resolution
planning practices for the specified
firms. The final guidance provides
examples of resolution plan content and
capabilities that the agencies generally
consider consistent with effective
resolution planning. This approach is
consistent with resolution planning
guidance provided to other covered
companies in the past, including
guidance for Category I banking
organizations and certain foreign
Category II banking organizations.
A commenter argued that the agencies
should allow for an iterative process for
foreign triennial full filers to develop
their strategies and capabilities, similar
to the gradual maturation of Category I
banking organizations’ resolution plans.
This commenter also argued the
agencies should provide more than one
year for firms to incorporate the final
guidance into their next resolution plan
submissions and that the guidance
should not be the basis for a deficiency.
By statute and under the Rule, each
resolution plan filer must submit a plan
for orderly resolution under the
Bankruptcy Code, and the agencies must
assess the credibility of each plan. Each
firm remains free to choose the
resolution strategy it believes would
most effectively facilitate an orderly

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66527

resolution and the agencies are not
suggesting that any firm change its
resolution strategy, nor do the agencies
identify a preferred strategy for a
specific firm or set of firms. The
standard of review for a resolution plan
submission of a firm that transitions to
a new strategy is the same as for any
firm subject to the Rule. The agencies
stated in the preamble to the 2019
revisions to the Rule that they would
endeavor to finalize guidance a year in
advance of the next applicable
resolution plan submission date, and
the agencies are extending the next
resolution plan submission deadline for
these firms to provide at least one year
advanced notice of general guidance.73
The agencies also reaffirm that the
guidance does not have the force and
effect of law, and the agencies do not
take enforcement actions or issue
findings based on resolution planning
guidance.
A commenter argued that the various
capital and resolution related proposals
would, when considered holistically,
disproportionately affect international
banks and discourage international bank
participation in U.S. banking and
financial services markets to the
detriment of U.S. financial stability.
This commenter further cautioned that
additional expectations for the U.S.
operations of international banks could
have unintended consequences and may
lead to similar demands by other hostcountry supervisors, which could lead
to fragmentation and less orderly
resolution.
This guidance does not create
additional requirements, but rather
describes one approach to resolution
plan content that could address the
agencies’ expectations. Furthermore, the
agencies recognize that the specified
firms’ U.S. operations differ not only in
the businesses they engage in, but also
in their scope, size, and complexity. As
such, the agencies expect that firms will
adapt the guidance expectations in a
manner commensurate with the risk
profile of their U.S. operations. Doing so
in a proportionate manner does not
disadvantage the specified firms relative
to domestic or foreign peers and the
guidance does not serve as a deterrent
to participating in the U.S. financial
market.
Additionally, the agencies believe the
guidance would help facilitate orderly
resolution of U.S. operations of the
specified firms in the event an orderly
home-country led group-wide resolution
is not feasible. The agencies note that to
date, the existence of guidance for
73 See 2019 Federal Register Publication at 84 FR
59204.

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certain FBOs has not led to increased
fragmentation, but rather has enhanced
the dialogue among authorities about
expectations for those FBOs’ capabilities
and resolution preparedness. The
agencies will continue to engage with
home-country authorities on resolution
planning for foreign triennial full filers.

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Comments About Resolution Planning
Generally
Finally, a commenter asked the
agencies to provide more information on
the inconsistencies and problematic
assumptions found in the 2021 plan
submissions, as well as why the UBS
Group AG’s acquisition of CS and the
U.S. domestic bank resolutions in 2023
prompted reversals of policy.
The agencies believe the preamble to
the proposed guidance addresses the
findings from the 2021 resolution plan
submissions and learnings from the
2023 bank resolutions. The agencies
would refer the commenter to other
areas of this preamble for explanation of
new areas of guidance, including the
2020 FBO Proposed Guidance. No
specific changes have been made to the
final guidance in response to this
comment.
Comments Outside the Scope of
Proposal
The agencies received several
comments outside the scope of the
proposed guidance. One commenter
urged the agencies to shorten the length
between resolution plan submissions
under the Rule, from three to two years,
and evaluate key aspects of plans
annually. This commenter also
recommended the agencies create an
independent committee to advise the
agencies on resolution planning matters
as well as require large banking
organizations to hold more capital
generally. Another commenter argued
that any LTD requirements should
reflect a banking organization’s
preferred resolution strategy and not
push a banking organization to adopt a
particular strategy. That commenter also
encouraged the FDIC to provide banking
organizations at least one year to
comply with any final IDI Rule and to
align aspects of the IDI Rule with
resolution planning under section
165(d) of the Dodd-Frank Act. The
agencies have not made any changes to
the guidance to address these
comments.
IV. Paperwork Reduction Act
Certain provisions of the final
guidance contain ‘‘collections of
information’’ within the meaning of the
Paperwork Reduction Act (PRA) of 1995
(44 U.S.C. 3501–3521). In accordance

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with the requirements of the PRA, the
agencies may not conduct or sponsor,
and the respondent is not required to
respond to, an information collection
unless it displays a currently valid
Office of Management and Budget
(OMB) control number. The agencies
have requested and OMB has assigned
to the agencies the respective control
numbers shown. The information
collections contained in the final
guidance have been submitted to OMB
for review and approval by the FDIC
under section 3507(d) of the PRA (44
U.S.C. 3507(d)) and section 1320.11 of
OMB’s implementing regulations (5 CFR
part 1320). The Board reviewed the final
guidance under the authority delegated
to the Board by OMB and has approved
these collections of information.
The agencies did not receive any
comments related to the PRA.
The agencies have a continuing
interest in the public’s opinions of
information collections. At any time,
commenters may submit comments
regarding the burden estimate, or any
other aspect of this collection of
information, including suggestions for
reducing the burden, to the addresses
listed in the ADDRESSES caption in the
proposed guidance notice. All
comments will become a matter of
public record. Written comments and
recommendations for these information
collections also should be sent within
30 days of publication of this document
to www.reginfo.gov/public/do/
PRAMain. Find this particular
information collection by selecting
‘‘Currently under 30-day Review—Open
for Public Comments’’ or by using the
search function.
Collection title: Board: Reporting
Requirements Associated with
Regulation QQ.
FDIC: Reporting Requirements
Associated with Resolution Planning.
OMB control number: Board 7100–
0346; FDIC 3064–0210.
Frequency: Triennial, Biennial, and
on occasion.
Respondents: Bank holding
companies (including any foreign bank
or company that is, or is treated as, a
bank holding company under section
8(a) of the International Banking Act of
1978 and meets the relevant total
consolidated assets threshold) with total
consolidated assets of $250 billion or
more, a bank holding companies with
$100 billion or more in total
consolidated assets with certain
characteristics, and nonbank financial
firms designated by the Financial
Stability Oversight Council for
supervision by the Board.
Current actions: The final guidance
modifies certain provisions of the

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proposed guidance. For domestic firms,
the final guidance eliminates
expectations related to separability,
reducing the average burden hours per
response by 3,000 for domestic firms
using an SPOE strategy and 975 for
domestic firms using an MPOE strategy.
The final guidance also clarifies
expectations around operational shared
services for firms using an SPOE
resolution strategy and around the IDI
Resolution Plan/Least-Cost Test for all
firms. Regarding operational shared
services, the guidance clarifies that a
firm’s implementation plan to ensure
continuity of shared services should
include those that are material to the
execution of the resolution strategy,
such as reliance on outside bankruptcy
counsel and consultants. Regarding the
FDI Act’s least-cost requirement and
how it relates to expectations around IDI
resolution, the agencies provided
additional detail on how firms can
develop and support the valuation of an
IDI’s assets and liabilities in an IDI
resolution. The agencies do not
anticipate these clarifications impacting
the burden estimates.
Historically, the Board and the FDIC
have split the respondents for purposes
of PRA clearances. As such, the agencies
will split the change in burden as well.
As a result of this split and the final
revisions, there is a proposed net
increase in the overall estimated burden
hours of 14,922 hours for the Board and
14,304 hours for the FDIC. Therefore,
the total Board estimated burden for its
entire information collection would be
216,129 hours and the total FDIC
estimated burden would be 210,844
hours.
The following table presents only the
change in the estimated burden hours,
as amended by the final guidance,
broken out by agency. The table does
not include a discussion of the
remaining estimated burden hours
which remain unchanged.74 As shown
in the table, the triennial full filers’
resolution plan submissions would be
estimated more granularly according to
SPOE and MPOE resolution strategies.
74 In addition to the revisions to the estimations
for triennial full filers, the agencies have revised the
estimation for biennial filers from 40,115 hours per
response to 39,550 hours per response to align with
burden estimation methodology with what was
used for triennial full filers under the final
guidance. Specifically, the agencies removed a
component for a biennial filer’s analysis of its
critical operations as part of its submission of
targeted and full resolution plans, because this
critical operations analysis is integrated in the
preparation of such plans.

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Estimated
number of
respondents

FR QQ

Estimated
annual
frequency

Estimated
average hours
per response

Estimated
annual burden
hours

Board Burdens
Current
Triennial Full:
Complex Foreign .......................................................................
Foreign and Domestic ...............................................................

1
7

1
1

9,777
4,667

9,777
32,669

Current Total ......................................................................
Final
Triennial Full:
FBO SPOE * ..............................................................................
FBO MPOE ...............................................................................
Domestic MPOE ........................................................................

........................

........................

............................

42,446

2
3
3

1
1
1

11,848
5,939
5,285

23,696
17,817
15,855

Final Total ..........................................................................

........................

........................

............................

57,368

1
6

1
1

9,777
4,667

9,777
28,002

Current Total ......................................................................
Final
Triennial Full:
FBO SPOE ................................................................................
FBO MPOE ...............................................................................
Domestic MPOE ........................................................................

........................

........................

............................

37,779

2
3
2

1
1
1

11,848
5,939
5,285

23,696
17,817
10,570

Final Total ..........................................................................

........................

........................

............................

52,083

FDIC Burdens
Current
Triennial Full:
Complex Foreign .......................................................................
Foreign and Domestic ...............................................................

* There are currently no domestic triennial full filers utilizing an SPOE strategy. Estimated hours per response for a domestic SPOE triennial
full filer would be 10,535 hours.

V. Text of the Final Guidance
Guidance for Resolution Plan
Submissions of Foreign Triennial Full
Filers

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I. Introduction
Section 165(d) of the Dodd-Frank
Wall Street Reform and Consumer
Protection Act (12 U.S.C. 5365(d))
requires certain financial companies to
report periodically to the Board of
Governors of the Federal Reserve
System (the Board) and the Federal
Deposit Insurance Corporation (the
FDIC) (together, the agencies) their
plans for rapid and orderly resolution in
the event of material financial distress
or failure. On November 1, 2011, the
agencies promulgated a joint rule
implementing the provisions of section
165(d).1 Subsequently, in November
2019, the agencies finalized
amendments to the joint rule addressing
amendments to the Dodd-Frank Act
made by the Economic Growth,
Regulatory Relief, and Consumer
Protection Act and improving certain
aspects of the joint rule based on the
agencies’ experience implementing the
1 Resolution

Plans Required, 76 FR 67323 (Nov.

1, 2011).

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joint rule since its adoption.2 Financial
companies meeting criteria set out in
the Rule must file a resolution plan
(Plan) according to the schedule
specified in the Rule.
This document is intended to provide
guidance to certain foreign financial
companies required to submit Plans
regarding development of their
respective U.S. strategies to assist their
further development of a Plan for their
2025 and subsequent Plan submissions.
Specifically, the guidance applies to any
foreign-based covered company that is
triennial full filer under the Rule 3
because it is subject to Category II or III
standards according to its combined
U.S. operations in accordance with the
Board’s tailoring rule (specified firms or
firms).4 This guidance supersedes the
joint Guidance for Resolution Plan
Submissions of Certain Foreign-Based
Covered Companies.5
2 Resolution Plans Required, 84 FR 59194 (Nov.
1, 2019). The amendments became effective
December 31, 2019. The ‘‘Rule’’ means the joint rule
as amended in 2019. Terms not defined herein have
the meanings set forth in the Rule.
3 See 12 CFR 243.4(b)(1) and 381.4(b)(1).
4 Prudential Standards for Large Bank Holding
Companies, Savings and Loan Holding Companies,
and Foreign Banking Organizations, 84 FR 59032
(Nov. 1, 2019).
5 85 FR 83557 (Dec. 22, 2020).

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The Plan for a specified firm would
address a scenario where its U.S.
operations experience material financial
distress and the foreign parent is unable
or unwilling to provide sufficient
financial support for the continuation of
U.S. operations, and at least the top tier
U.S. IHC files for bankruptcy under title
11, United States Code. Under such a
scenario, the Plan should provide for
the orderly resolution of the specified
firm’s U.S. material entities and
operations.
The document does not have the force
and effect of law.6 Rather, it describes
the agencies’ expectations and priorities
regarding the specified firms’ Plans and
the agencies’ general views regarding
specific areas where additional detail
should be provided and where certain
capabilities or optionality should be
developed and maintained to
demonstrate that each firm has
considered fully, and is able to mitigate,
obstacles to the successful
implementation of their U.S. resolution
strategy.
When an FBO first becomes a
specified firm,7 this document will
6 See 12 CFR 262.7 and appendix A to 12 CFR
part 262; 12 CFR part 302.
7 See 12 CFR 252.5(c)–(d).

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apply to the firm’s next resolution plan
submission that is due at least 12
months after the date the firm becomes
a specified firm. If a specified firm
ceases to be subject to Category II or III
standards, it will no longer be a
specified firm, and this document
would no longer apply to that firm.
In general, this document is organized
around a number of key challenges in
resolution (interaction with group
resolution plan; capital; liquidity;
governance mechanisms; operational;
branches; legal entity rationalization
and separability; and insured depository
institution resolution (IDI), if
applicable) that apply across resolution
plans, depending on their strategy.
Additional challenges or obstacles may
arise based on a firm’s particular
structure, operations, or resolution
strategy. Each firm is expected to
satisfactorily address these
vulnerabilities in its Plan. In addition,
each topic of this guidance is separated
into expectations for a specified firm
that adopts a U.S. single point of entry
(U.S. SPOE) resolution strategy for its
Plan and expectations for a specified
firm that adopts a U.S. multiple point of
entry (U.S. MPOE) resolution strategy
for its Plan.8
Under the Rule, the agencies will
review a Plan to determine if it
satisfactorily addresses key potential
challenges, including those specified
below. If the agencies jointly decide that
an aspect of a Plan presents a weakness
that individually or in conjunction with
other aspects could undermine the
feasibility of the Plan, the agencies may
determine jointly that the Plan is not
credible or would not facilitate an
orderly resolution under the U.S.
Bankruptcy Code. The agencies may not
take enforcement actions or issue
findings based on this guidance.
II. Interaction With Group Resolution
Plan

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U.S. SPOE and U.S. MPOE
The agencies recognize that the
preferred resolution outcome for the
8 The agencies recognize that the preferred
resolution outcome for many specified firms is a
successful home country resolution using a global
SPOE resolution strategy where U.S. material
entities are provided with sufficient capital and
liquidity resources to allow them to stay out of
resolution proceedings and maintain continuity of
operations throughout the parent’s resolution.
However, because support from the foreign parent
in stress cannot be ensured, the Rule provides that
the U.S. resolution plan for specified firms must
specifically address a scenario where the U.S.
operations experience material financial distress,
and the Plan cannot assume that the specified firm
takes resolution actions outside the United States
that would eliminate the need for any U.S.
subsidiaries to enter resolution proceedings. See 12
CFR 243.4(h) and 381.4(h).

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specified firms is often a successful
SPOE home country resolution. Based
on information available to the firm, a
specified firm’s Plan should describe: (i)
the impact of executing the global
resolution plan on U.S. operations, (ii)
the extent of the specified firm’s
reliance on U.S. operations for
execution of the global resolution plan,
(iii) the extent of the specified firm’s
reliance on home country entities and
operations for execution of the Plan, and
(iv) any capabilities relied on to execute
the U.S. resolution strategy that are
different from those necessary to
execute the global strategy. In addition,
a specified firm’s resolvability work in
the United States should consider both
the objectives of the firm’s group-wide
resolution strategy and the Rule. Efforts
to enhance the resolvability of U.S.
operations and entities should be as
complementary as practicable to the
group-wide resolution strategy, while
complying with the Rule.
III. Capital
U.S. SPOE
The firm should have the capital
capabilities necessary to execute its U.S.
resolution strategy, including the
modeling and estimation process
described below.
Resolution Capital Adequacy and
Positioning (RCAP). In order to help
ensure that a firm’s U.S. non-branch
material entities 9 could be resolved in
an orderly manner, the firm’s U.S. IHC
should have an adequate amount of
loss-absorbing capacity to execute its
U.S. resolution strategy. Thus, a firm’s
U.S. IHC should have outstanding a
minimum amount of loss-absorbing
capacity, including long-term debt, to
help ensure that the firm has adequate
capacity to meet that need at the U.S.
IHC on a consolidated basis (IHC
LAC).10
Proceeds from a firm’s IHC LAC
should be appropriately positioned
9 The terms ‘‘material entities,’’ ‘‘identified
critical operations,’’ and ‘‘core business lines’’ have
the same meaning as in the Rule. The term ‘‘U.S.
material entity’’ means any subsidiary, branch, or
agency that is a material entity and is domiciled in
the United States. The term ‘‘U.S. non-branch
material entity’’ means a material entity organized
or incorporated in the U.S. including, in all cases,
the U.S. IHC. The term ‘‘U.S. IHC subsidiaries’’
means all U.S. non-branch material entities other
than the U.S. IHC.
10 Total Loss-Absorbing Capacity, Long-Term
Debt, and Clean Holding Company Requirements
for Systemically Important U.S. Bank Holding
Companies and Intermediate Holding Companies of
Systemically Important Foreign Banking
Organizations, 82 FR 8266 (Jan. 24, 2017); LongTerm Debt Requirements for Large Bank Holding
Companies, Certain Intermediate Holding
Companies of Foreign Banking Organizations, and
Large Insured Depository Institutions, 88 FR 64524
(Sept. 19, 2023).

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between the U.S. IHC and the
subsidiaries of the U.S. IHC that are
material entities (U.S. IHC subsidiaries),
consistent with any applicable rules
requiring prepositioned resources at
U.S. IDIs in the form of long-term debt.
After adhering to any requirements
related to prepositioning long-term debt
at IDIs, the positioning of a firm’s
remaining IHC LAC should balance the
certainty associated with prepositioning loss absorbing capacity
directly at U.S. IHC subsidiaries
(internal LAC) with the flexibility
provided by holding recapitalization
resources at the U.S. IHC (contributable
resources) to meet unanticipated losses
at the U.S. IHC subsidiaries. That
balance should take account of both prepositioning at U.S. IHC subsidiaries and
holding resources at the U.S. IHC, and
the obstacles associated with each. With
respect to material entities that are not
subject to pre-positioning requirements,
the firm should not rely exclusively on
either full pre-positioning or U.S. IHC
contributable resources to execute its
U.S. resolution strategy, unless it has
only one U.S. IHC subsidiary that is an
operating subsidiary. The Plan should
describe the positioning of internal LAC
among the U.S. IHC and the U.S. IHC
subsidiaries, along with analysis
supporting such positioning.
Finally, to the extent that prepositioned internal LAC at a U.S. IHC
subsidiary is in the form of
intercompany debt and there are one or
more entities between the lender and
the borrower, the firm should structure
the instruments so as to ensure that the
U.S. IHC subsidiary can be
recapitalized.
Resolution Capital Execution Need
(RCEN). To the extent necessitated by
the firm’s U.S. resolution strategy, U.S.
non-branch material entities need to be
recapitalized to a level that allows them
to operate or be wound down in an
orderly manner following the U.S. IHC
bankruptcy filing. The firm should have
a methodology for periodically
estimating the amount of capital that
may be needed to support each U.S. IHC
subsidiary after the U.S. IHC bankruptcy
filing (RCEN). The firm’s positioning of
IHC LAC should be able to support the
RCEN estimates.
The firm’s RCEN methodology should
use conservative forecasts for losses and
risk-weighted assets and incorporate
estimates of potential additional capital
needs through the resolution period,11
consistent with the firm’s resolution
strategy for its U.S. operations. The
11 The resolution period begins immediately after
the U.S. IHC bankruptcy filing and extends through
the completion of the U.S. resolution strategy.

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RCEN methodology should be calibrated
such that recapitalized U.S. IHC
subsidiaries will have sufficient capital
to maintain market confidence as
required under the U.S resolution
strategy. Capital levels should meet or
exceed all applicable regulatory capital
requirements for ‘‘well-capitalized’’
status and meet estimated additional
capital needs throughout resolution.
U.S. IHC subsidiaries that are not
subject to capital requirements may be
considered sufficiently recapitalized
when they have achieved capital levels
typically required to obtain an
investment-grade credit rating or, if the
entity is not rated, an equivalent level
of financial soundness. Finally, the
methodology should be independently
reviewed, consistent with the firm’s
corporate governance processes and
controls for the use of models and
methodologies.
U.S. MPOE
N/A.

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IV. Liquidity
U.S. SPOE
The firm should have the liquidity
capabilities necessary to execute its U.S
resolution strategy, including those
described below. For resolution
purposes, these capabilities should
include having an appropriate model
and process for estimating and
maintaining sufficient liquidity at—or
readily available from the U.S. IHC to—
U.S. IHC subsidiaries, and a
methodology for estimating the liquidity
needed to successfully execute the U.S.
resolution strategy, as described below.
Capabilities. A firm is expected to
have a comprehensive understanding of
funding sources, uses, and risks at
material entities and identified critical
operations, including how funding
sources may be affected under stress.
For example, a firm should have and
describe its capabilities to:
(A) Evaluate the funding requirements
necessary to perform identified critical
operations, including shared and
outsourced services and access to
financial market utilities (FMUs); 12
(B) Monitor liquidity reserves and
relevant custodial arrangements by
jurisdiction and material entity; 13
(C) Routinely test funding and
liquidity outflows and inflows for U.S.
non-branch material entities at the legal
entity level under a range of adverse
stress scenarios, taking into account the
effect on intra-day, overnight, and term
funding flows between affiliates and
across jurisdictions;
12 12
13 12

CFR 252.156(g)(3).
CFR 252.156(g)(2).

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(D) Assess existing and potential
restrictions on the transfer of liquidity
between U.S. non-branch material
entities; 14 and
(E) Develop contingency strategies to
maintain funding for U.S. non-branch
material entities and identified critical
operations in the event of a disruption
in the specified firm’s current funding
model.15
Resolution Liquidity Adequacy and
Positioning (RLAP). With respect to
RLAP, the firm should be able to
measure the stand-alone liquidity
position of each U.S. non-branch
material entity—i.e., the high-quality
liquid assets (HQLA) at the U.S. nonbranch material entity less net outflows
to third parties and affiliates—and
ensure that liquidity is readily available
to meet any deficits. The RLAP model
should cover a period of at least 30 days
and reflect the idiosyncratic liquidity
profile of the U.S. IHC and risk of each
U.S. IHC subsidiary. The model should
balance the reduction in frictions
associated with holding liquidity
directly at the U.S. IHC subsidiary with
the flexibility provided by holding
HQLA at the U.S. IHC or at a U.S. IHC
subsidiary available to meet
unanticipated outflows at other U.S.
IHC subsidiaries.16 The firm should not
rely exclusively on either full prepositioning or U.S. IHC contributable
resources to execute its U.S. resolution
strategy, unless it has only one U.S. IHC
subsidiary that is an operating
subsidiary.
The model 17 should ensure that on a
consolidated basis the U.S. IHC holds
sufficient HQLA to cover net liquidity
outflows of the U.S. non-branch
material entities. The model should also
measure the stand-alone net liquidity
positions of each U.S. non-branch
material entity. The stand-alone net
liquidity position of each U.S. nonbranch material entity (HQLA less net
outflows) should be measured using the
firm’s internal liquidity stress test
assumptions and should treat interaffiliate exposures in the same manner
as third-party exposures. For example,
an overnight unsecured exposure to a
non-U.S. affiliate should be assumed to
mature. Finally, the firm should not
assume that a net liquidity surplus at
14 Id.
15 12

CFR 252.156(e).
the extent HQLA is held at the U.S. IHC or
at a U.S. IHC subsidiary, the model should consider
whether such funds are freely available. To be
freely available, the HQLA must be free of legal,
regulatory, contractual, and other restrictions on the
ability of the material entity to liquidate, sell, or
transfer the asset.
17 ‘‘Model’’ refers to the set of calculations
required by Regulation YY that estimate the U.S.
IHC’s liquidity position.
16 To

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any U.S. IHC subsidiary that is a
depository institution could be moved
to meet net liquidity deficits at an
affiliate, or to augment U.S. IHC
resources, consistent with Regulation
W.
Additionally, the RLAP methodology
should take into account for each of the
U.S. IHC, U.S. IHC subsidiaries, and any
branch that is a material entity:
(A) The daily contractual mismatches
between their respective inflows and
outflows;
(B) Their respective daily flows from
movement of cash and collateral for all
inter-affiliate transactions; and
(C) Their respective daily stressed
liquidity flows and trapped liquidity as
a result of actions taken by clients,
counterparties, key FMUs, and foreign
supervisors, among others.
In calculating its RLAP estimate, the
U.S. IHC should calculate its liquidity
position with respect to its foreign
parent, branches and agencies, and
other affiliates (together, affiliates)
separately from its liquidity position
with respect to third parties, and should
not offset inflows from affiliated parties
against outflows to external parties. In
addition, a U.S. IHC should use cashflow sources from its affiliates to offset
cash-flow needs of its affiliates only to
the extent that the term of the cash-flow
source from its affiliates is the same as,
or shorter than, the term of the cashflow need of its affiliates.18
Resolution Liquidity Execution Need
(RLEN). The firm should have a
methodology for estimating the liquidity
needed after the U.S. IHC’s bankruptcy
filing to stabilize any surviving U.S. IHC
subsidiaries and to allow those entities
to operate post-filing, in accordance
with the U.S. strategy.
The firm’s RLEN methodology should:
(A) Estimate the minimum operating
liquidity (MOL) needed at each U.S. IHC
subsidiary that is a material entity to
ensure those entities could continue to
operate, to the extent relied upon in the
U.S. resolution strategy, after
implementation of the U.S. resolution
strategy and/or to support a wind-down
strategy;
(B) Provide daily cash flow forecasts
by U.S. IHC subsidiary to support
estimation of peak funding needs to
stabilize each entity under resolution;
(C) Provide a comprehensive breakout
of all inter-affiliate transactions and
arrangements that could impact the
MOL or peak funding needs estimates
for the U.S. IHC subsidiaries; and
18 The U.S. IHC should calculate its cash-flow
sources from its affiliates consistent with the net
internal stressed cash-flow need calculation in
§ 252.157(c)(2)(iv) of Regulation YY.

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(D) Estimate the minimum amount of
liquidity required at each U.S. IHC
subsidiary to meet the MOL and peak
needs noted above, which would inform
the provision of financial resources from
the foreign parent to the U.S. IHC, or if
the foreign parent is unable or unwilling
to provide such financial support, any
preparatory resolution-related actions.
The MOL estimates should capture
U.S. IHC subsidiaries’ intraday liquidity
requirements, operating expenses,
working capital needs, and inter-affiliate
funding frictions to ensure that U.S. IHC
subsidiaries could operate without
disruption during the resolution.
The peak funding needs estimates
should be projected for each U.S. IHC
subsidiary and cover the length of time
the firm expects it would take to
stabilize that U.S. IHC subsidiary. Interaffiliate funding frictions should be
taken into account in the estimation
process.
The firm’s forecasts of MOL and peak
funding needs should ensure that U.S.
IHC subsidiaries could operate through
resolution consistent with regulatory
requirements, market expectations, and
the firm’s post-failure strategy. These
forecasts should inform the RLEN
estimate, i.e., the minimum amount of
HQLA required to facilitate the
execution of the firm’s strategy for the
U.S. IHC subsidiaries.
For nonsurviving U.S. IHC
subsidiaries, the firm should provide
analysis and an explanation of how the
material entity’s resolution could be
accomplished within a reasonable
period of time and in a manner that
substantially mitigates the risk of
serious adverse effects on U.S. financial
stability. For example, if a U.S. IHC
subsidiary that is a broker-dealer is
assumed to fail and enter resolution
under the Securities Investor Protection
Act, the firm should provide an analysis
of the potential impacts on funding and
asset markets and on prime brokerage
clients, bearing in mind the objective of
an orderly resolution.

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U.S. MPOE
The firm should have the liquidity
capabilities necessary to execute its U.S.
resolution strategy. A Plan with a U.S.
MPOE resolution strategy should
include analysis and projections of a
range of liquidity needs during
resolution, including intraday; reflect
likely failure and resolution scenarios;
and consider the guidance on
assumptions provided in Section X,
Format and Structure of Plans;
Assumptions.

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V. Governance Mechanisms
U.S. SPOE
A firm should identify the governance
mechanisms that would ensure that
communication and coordination occur
between the governing body of the U.S.
operations (for example, the boards of
the U.S. IHC or a U.S. subsidiary) and
the foreign parent to facilitate the
provision of financial support, or if not
forthcoming, any preparatory
resolution-related actions to facilitate an
orderly resolution.
Playbooks, Foreign Parent Support,
and Triggers. Governance playbooks
should detail the board and senior
management actions of U.S. non-branch
material entities that would be needed
under the firm’s U.S. resolution strategy.
The governance playbooks should also
include a discussion of:
(A) The firm’s proposed U.S.
communications strategy, both internal
and external; 19
(B) The fiduciary responsibilities of
the applicable board(s) of directors or
other similar governing bodies and how
planned actions would be consistent
with such responsibilities applicable at
the time actions are expected to be
taken;
(C) Potential conflicts of interest,
including interlocking boards of
directors;
(D) Any employee retention policy;
and
(E) Any other limitations on the
authority of the U.S. IHC and the U.S.
IHC subsidiary boards and senior
management to implement the U.S.
resolution strategy. All responsible
parties and timeframes for action should
be identified. Governance playbooks
should be updated periodically for each
entity whose governing body would
need to act under the firm’s U.S.
resolution strategy.
In order to meet liquidity needs at the
U.S. non-branch material entities, the
firm may either fully pre-position
liquidity in the U.S. non-branch
material entities or develop a
mechanism for planned foreign parent
support, of any amount not prepositioned, for the successful execution
of the U.S. strategy. Mechanisms to
support readily available liquidity may
include a term liquidity facility between
the U.S. IHC and the foreign parent that
can be drawn as needed and as
informed by the firm’s RLEN estimates
and liquidity positioning. To the extent
the preferred global resolution strategy
for the firm is a home country SPOE
19 External communications include those with
U.S. and foreign authorities and other external
stakeholders, such as any large depositors.

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resolution, the mechanism should be
designed so as to not interfere with the
execution of that strategy. The Plan
should include analysis of how the U.S.
IHC/foreign parent facility is funded or
buffered for by the foreign parent. The
sufficiency of the liquidity should be
informed by the firm’s RLAP and RLEN
estimates for the U.S. non-branch
material entities. Additionally, the Plan
should include analysis of the potential
challenges to the planned foreign parent
support mechanism and associated
mitigants. Where applicable, the
analysis should discuss applicable nonU.S. law and cross-border legal
challenges (e.g., challenges related to
enforcing contracts governed by foreign
law). The analysis should identify the
mitigant(s) to such challenges that the
firm considers most effective.
The firm should be prepared to
increase communication and
coordination at the appropriate time in
order to mitigate financial, operational,
legal, and regulatory vulnerabilities. To
facilitate this communication and
coordination, the firm should establish
clearly identified triggers linked to
specific actions for:
(A) The escalation of information to
U.S. senior management, U.S. risk
committee and U.S. governing bodies to
potentially take the corresponding
actions as the U.S. operations
experience material financial distress,
leading eventually to the decision to
implement the U.S. resolution strategy.
The triggers should:
i. Identify when and under what
conditions the U.S. material entities
would transition from business-as-usual
(BAU) conditions to a stress period; and
ii. Take into consideration changes in
the foreign parent’s condition from BAU
conditions through resolution.
(B) The escalation of information to
and discussions with the appropriate
governing bodies to confirm whether the
governing bodies are able and willing to
provide financial resources to support
U.S. operations.
i. Triggers should be based on the
firm’s methodology for forecasting the
liquidity and capital needed to facilitate
the U.S. strategy. For example, triggers
may be established that reflect U.S. nonbranch material entities’ financial
resources approaching RCEN/RLEN
estimates, with corresponding actions to
confirm the foreign parent’s financial
capability and willingness to provide
sufficient support.
Corresponding escalation procedures,
actions, and timeframes should be
constructed so that breach of the triggers
will allow prerequisite actions to be
completed. For example, breach of the
triggers needs to occur early enough to

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provide for communication,
coordination, and confirmation of the
provision of resources from the foreign
parent.
Support Within the United States. If
the Plan provides for the provision of
capital and liquidity by a U.S. material
entity (e.g., the U.S. IHC) to its U.S.
affiliates prior to the U.S. IHC’s
bankruptcy filing (Support), the Plan
should also include a detailed legal
analysis of the potential state law and
bankruptcy law challenges and
mitigants to providing the Support.
Specifically, the analysis should
identify potential legal obstacles and
explain how the firm would seek to
ensure that Support would be provided
as planned. Legal obstacles include
claims of fraudulent transfer,
preference, breach of fiduciary duty,
and any other applicable legal theory
identified by the firm. The analysis also
should include related claims that may
prevent or delay an effective
recapitalization, such as equitable
claims to enjoin the transfer (e.g.,
imposition of a constructive trust by the
court). The analysis should apply the
actions contemplated in the Plan
regarding each element of the claim, the
anticipated timing for commencement
and resolution of the claims, and the
extent to which adjudication of such
claim could affect execution of the
firm’s U.S. resolution strategy. The
analysis should include mitigants to the
potential challenges to the planned
Support. The Plan should identify the
mitigant(s) to such challenges that the
firm considers most effective.
Furthermore, the Plan should describe
key motions to be filed at the initiation
of any bankruptcy proceeding related to
(as appropriate) asset sales and other
non-routine matters.
U.S. MPOE
A firm should identify the governance
mechanisms that would ensure that
communication and coordination occur
between the governing body of the U.S.
operations (for example, the boards of
the U.S. IHC or a U.S. subsidiary) and
the foreign parent to facilitate any
preparatory resolution-related actions to
facilitate an orderly resolution. The Plan
should also detail the board and senior
management actions of U.S. material
entities that would be needed under the
firm’s U.S. resolution strategy.
The firm should be prepared to
increase communication and
coordination at the appropriate time in
order to mitigate financial, operational,
legal, and regulatory vulnerabilities. To
facilitate this communication and
coordination, the firm should establish
clearly identified triggers linked to

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specific actions for the escalation of
information to U.S. senior management,
U.S. risk committee and U.S. governing
bodies to potentially take the
corresponding actions as the U.S.
operations experience material financial
distress, leading eventually to the
decision to implement the U.S.
resolution strategy. The triggers should:
(A) Identify when and under what
conditions the U.S. material entities
would transition from BAU conditions
to a stress period.
(B) Take into consideration changes in
the foreign parent’s condition from BAU
conditions through resolution.
VI. Operational
U.S. SPOE
Payment, Clearing, and Settlement
Activities Framework. Maintaining
continuity of payment, clearing, and
settlement (PCS) services is critical for
the orderly resolution of firms that are
either users or providers,20 or both, of
PCS services. A firm should
demonstrate capabilities for continued
access to PCS services essential to an
orderly resolution under its U.S.
resolution strategy through a framework
to support such access by:
• Identifying clients,21 FMUs, and
agent banks as key from the firm’s
perspective for the firm’s U.S. material
entities, identified critical operations,
and core business lines, using both
quantitative (volume and value) 22 and
qualitative criteria;
• Mapping U.S. material entities,
identified critical operations, core
business lines, and key clients of the
firm’s U.S. operations to both key FMUs
and key agent banks; and
• Developing a playbook for each key
FMU and key agent bank essential to an
20 A firm is a user of PCS services if it accesses
PCS services through an agent bank or it uses the
services of a financial market utility (FMU) through
its membership in that FMU or through an agent
bank. A firm is a provider of PCS services if it
provides PCS services to clients as an agent bank
or it provides clients with access to an FMU or
agent bank through the firm’s membership in or
relationship with that service provider. A firm is
also a provider if it provides clients with PCS
services through the firm’s own operations (e.g.,
payment services or custody services).
21 For purposes of this section, a client is an
individual or entity, including affiliates of the firm,
to whom the firm provides PCS services and any
related credit or liquidity offered in connection
with those services.
22 In identifying entities as key, examples of
quantitative criteria may include: for a client,
transaction volume/value, market value of
exposures, assets under custody, usage of PCS
services, and any extension of related intraday
credit or liquidity; for an FMU, the aggregate
volumes and values of all transactions processed
through such FMU; and for an agent bank, assets
under custody, the value of cash and securities
settled, and extensions of intraday credit.

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orderly resolution under its U.S.
resolution strategy that reflects the
firm’s role(s) as a user and/or provider
of PCS services.
The framework should address direct
relationships (e.g., a firm’s direct
membership in an FMU, a firm’s
provision of clients with PCS services
through its own operations in the
United States, or a firm’s contractual
relationship with an agent bank) and
indirect relationships (e.g., a firm’s
provision of clients with access to the
relevant FMU or agent bank through the
firm’s membership in or relationship
with that FMU or agent bank, or a firm’s
U.S. affiliate and branch provision of
U.S. material entities and key clients of
the firm’s U.S. operations with access to
an FMU or agent bank). The framework
also should address the potential impact
of any disruption to, curtailment of, or
termination of such direct and indirect
relationships on the firm’s U.S. material
entities, identified critical operations,
and core business lines, as well as any
corresponding impact on key clients of
the firm’s U.S. operations.
Playbooks for Continued Access to
PCS Services. The firm is expected to
provide a playbook for each key FMU
and key agent bank that addresses
considerations that would assist the
firm and key clients of the firm’s U.S.
operations in maintaining continued
access to PCS services in the period
leading up to and including the firm’s
resolution under its U.S. resolution
strategy.
Each playbook should provide
analysis of the financial and operational
impact to the firm’s U.S. material
entities and key clients of the firm’s U.S.
operations due to adverse actions that
may be taken by a key FMU or a key
agent bank and contingency actions that
may be taken by the firm. Each playbook
also should discuss any possible
alternative arrangements that would
allow continued access to PCS services
for the firm’s U.S. material entities,
identified critical operations and core
business lines, and key clients of the
firm’s U.S. operations, while the firm is
in resolution under its U.S. resolution
strategy. The firm is not expected to
incorporate a scenario in which it loses
key FMU or key agent bank access into
its U.S. resolution strategy or its RLEN
and RCEN estimates. The firm should
continue to engage with key FMUs, key
agent banks, and key clients of the
firm’s U.S. operations, and playbooks
should reflect any feedback received
during such ongoing outreach.
Content Related to Users of PCS
Services. Individual key FMU and key
agent bank playbooks should include:

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• Description of the firm’s
relationship as a user, including through
indirect access, with the key FMU or
key agent bank and the identification
and mapping of PCS services to the
firm’s U.S. material entities, identified
critical operations, and core business
lines that use those PCS services;
• Discussion of the potential range of
adverse actions that may be taken by
that key FMU or key agent bank when
the firm is in resolution under its U.S.
resolution strategy,23 the operational
and financial impact of such actions on
the firm’s U.S. material entities,
identified critical operations, and core
business lines, and contingency
arrangements that may be initiated by
the firm in response to potential adverse
actions by the key FMU or key agent
bank; and
• Discussion of PCS-related liquidity
sources and uses in BAU, in stress, and
in the resolution period, presented by
currency type (with U.S. dollar
equivalent) and by U.S. material entity.
Æ PCS Liquidity Sources: These may
include the amounts of intraday
extensions of credit, liquidity buffer,
inflows from FMU participants, and
prefunded amounts of key clients of the
firm’s U.S. operations in BAU, in stress,
and in the resolution period. The
playbook also should describe intraday
credit arrangements (e.g., facilities of the
key FMU, key agent bank, or a central
bank) and any similar custodial
arrangements that allow ready access to
a firm’s funds for PCS-related key FMU
and key agent bank obligations
(including margin requirements) in all
currencies relevant to the firm’s
participation, including placements of
firm liquidity at central banks, key
FMUs, and key agent banks.
Æ PCS Liquidity Uses: These may
include margin and prefunding by the
firm and key clients of the firm’s U.S.
operations, and intraday extensions of
credit, including incremental amounts
required during resolution.
Æ Intraday Liquidity Inflows and
Outflows: The playbook should describe
the firm’s ability to control intraday
liquidity inflows and outflows and to
identify and prioritize time-specific
payments. The playbook also should
describe any account features that might
restrict the firm’s ready access to its
liquidity sources.
Content Related to Providers of PCS
Services.24 Individual key FMU and key
agent bank playbooks should include:
23 Examples of potential adverse actions may
include increased collateral and margin
requirements and enhanced reporting and
monitoring.
24 Where a firm is a provider of PCS services
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• Identification and mapping of PCS
services to the firm’s U.S. material
entities, identified critical operations,
and core business lines that provide
those PCS services, and a description of
the scale and the way in which each
provides PCS services;
• Identification and mapping of PCS
services to key clients of the firm’s U.S.
operations to whom the firm’s U.S.
material entities, identified critical
operations, and core business lines
provide such PCS services and any
related credit or liquidity offered in
connection with such services;
• Discussion of the potential range of
firm contingency arrangements available
to minimize disruption to the provision
of PCS services to key clients of the
firm’s U.S. operations, including the
viability of transferring activity and any
related assets of key clients of the firm’s
U.S. operations, as well as any
alternative arrangements that would
allow the key clients of the firm’s U.S.
operations continued access to PCS
services if the firm could no longer
provide such access (e.g., due to the
firm’s loss of key FMU or key agent
bank access), and the financial and
operational impacts of such
arrangements from the firm’s
perspective;
• Descriptions of the range of
contingency actions that the firm may
take concerning its provision of intraday
credit to key clients of the firm’s U.S.
operations, including analysis
quantifying the potential liquidity the
firm could generate by taking such
actions in stress and in the resolution
period, such as (i) requiring key clients
of the firm’s U.S. operations to designate
or appropriately pre-position liquidity,
including through prefunding of
settlement activity, for PCS-related key
FMU and key agent bank obligations at
specific material entities of the firm
(e.g., direct members of key FMUs) or
any similar custodial arrangements that
allow ready access to funds for such
obligations in all relevant currencies of
key clients of the firm’s U.S. operations;
(ii) delaying or restricting PCS activity
of key clients of the firm’s U.S.
operations; and (iii) restricting,
imposing conditions upon (e.g.,
requiring collateral), or eliminating the
provision of intraday credit or liquidity
to key clients of the firm’s U.S.
operations; and
States, the firm is expected to produce a playbook
for the U.S. material entities that provide those
services, addressing each of the items described
under ‘‘Content Related to Providers of PCS
Services,’’ which include contingency arrangements
to permit the firm’s key clients of the firm’s U.S.
operations to maintain continued access to PCS
services.

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• Descriptions of how the firm will
communicate to key clients of the firm’s
U.S. operations the potential impacts of
implementation of any identified
contingency arrangements or
alternatives, including a description of
the firm’s methodology for determining
whether any additional communication
should be provided to some or all key
clients of the firm’s U.S. operations (e.g.,
due to BAU usage of that access and/or
related intraday credit or liquidity of the
key client of the firm’s U.S. operations),
and the expected timing and form of
such communication.
Capabilities. The firm is expected to
have and describe capabilities to
understand, for each U.S. material
entity, the obligations and exposures
associated with PCS activities,
including contractual obligations and
commitments. The firm should be able
to:
• Track the following items by (i) U.S.
material entity and, (ii) with respect to
customers, counterparties, and agents
and service providers, location and
jurisdiction:
Æ PCS activities, with each activity
mapped to the relevant material entities,
identified critical operations, and core
business lines; 25
Æ Customers and counterparties for
PCS activities, including values and
volumes of various transaction types, as
well as used and unused capacity for all
lines of credit; 26
Æ Exposures to and volumes
transacted with FMUs, nostro agents,
and custodians; and 27
Æ Services provided and service level
agreements, as applicable, for other
current agents and service providers
(internal and external); 28
• Assess the potential effects of
adverse actions by FMUs, nostro agents,
custodians, and other agents and service
providers, including suspension or
termination of membership or services,
on the firm’s U.S. operations and
customers and counterparties of those
U.S. operations; 29
• Develop contingency arrangements
in the event of such adverse actions; 30
and
• Quantify the liquidity needs and
operational capacity required to meet all
PCS obligations, including any change
in demand for and sources of liquidity
needed to meet such obligations.
Managing, Identifying, and Valuing
Collateral. The firm is expected to have
25 12

CFR 243.5(e)(12) and 381.5(e)(12).

26 Id.
27 12

CFR 252.156(g).
CFR 243.5(f)(l)(i) and 381.5(f)(1)(i).
29 12 CFR 252.156(e).
30 Id.
28 12

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and describe its capabilities to manage,
identify, and value the collateral that
the U.S. non-branch material entities
receive from and post to external parties
and affiliates. Specifically, the firm
should:
• Be able to query and provide
aggregate statistics for all qualified
financial contracts concerning crossdefault clauses, downgrade triggers, and
other key collateral-related contract
terms—not just those terms that may be
impacted in an adverse economic
environment—across contract types,
business lines, legal entities, and
jurisdictions;
• Be able to track both collateral
sources (i.e., counterparties that have
pledged collateral) and uses (i.e.,
counterparties to whom collateral has
been pledged) at the CUSIP level on at
least a t+1 basis;
• Have robust risk measurements for
cross-entity and cross-contract netting,
including consideration of where
collateral is held and pledged;
• Be able to identify CUSIP and asset
class level information on collateral
pledged to specific central
counterparties by legal entity on at least
a t+1 basis;
• Be able to track and report on interbranch collateral pledged and received
on at least a t+1 basis and have clear
policies explaining the rationale for
such inter-branch pledges, including
any regulatory considerations; and
• Have a comprehensive collateral
management policy that outlines how
the firm as a whole approaches
collateral and serves as a single source
for governance.31
In addition, as of the conclusion of
any business day, the firm should be
able to:
• Identify the legal entity and
geographic jurisdiction where
counterparty collateral is held;
• Document all netting and rehypothecation arrangements with
affiliates and external parties, by legal
entity; and
• Track and manage collateral
requirements associated with
counterparty credit risk exposures
between affiliates, including foreign
branches.
At least on a quarterly basis, the firm
should be able to:
• Review the material terms and
provisions of International Swaps and
Derivatives Association Master
Agreements and the Credit Support
Annexes, such as termination events, for
triggers that may be breached as a result
of changes in market conditions;
31 The policy may reference subsidiary or related
policies already in place, as implementation may
differ based on business line or other factors.

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• Identify legal and operational
differences and potential challenges in
managing collateral within specific
jurisdictions, agreement types,
counterparty types, collateral forms, or
other distinguishing characteristics; and
• Forecast changes in collateral
requirements and cash and non-cash
collateral flows under a variety of stress
scenarios.
Management Information Systems.
The firm should have the management
information systems (MIS) capabilities
to readily produce data on a U.S. legal
entity basis (including any U.S. branch)
and have controls to ensure data
integrity and reliability. The firm also
should perform a detailed analysis of
the specific types of financial and risk
data that would be required to execute
the U.S. resolution strategy and how
frequently the firm would need to
produce the information, with the
appropriate level of granularity. The
firm should have the capabilities to
produce the following types of
information, as applicable, in a timely
manner and describe these capabilities
in the Plan:
• Financial statements for each
material entity (at least monthly);
• External and inter-affiliate credit
exposures, both on- and off-balance
sheet, by type of exposure, counterparty,
maturity, and gross payable and
receivable;
• Gross and net risk positions with
internal and external counterparties;
• Guarantees, cross holdings,
financial commitments and other
transactions between material entities;
• Data to facilitate third-party
valuation of assets and businesses,
including risk metrics;
• Key third-party contracts, including
the provider, provider’s location,
service(s) provided, legal entities that
are a party to or a beneficiary of the
contract, and key contractual rights (for
example, termination and change in
control clauses);
• Legal agreement information,
including parties to the agreement and
key terms and interdependencies (for
example, change in control,
collateralization, governing law,
termination events, guarantees, and
cross-default provisions);
• Service level agreements between
affiliates, including the service(s)
provided, the legal entity providing the
service, legal entities receiving the
service, and any termination/
transferability provisions;
• Licenses and memberships to all
exchanges and value transfer networks,
including FMUs;
• Key management and support
personnel, including dual-hatted

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employees, and any associated retention
agreements;
• Agreements and other legal
documents related to property,
including facilities, technology systems,
software, and intellectual property
rights. The information should include
ownership, physical location, where the
property is managed and names of legal
entities and lines of business that the
property supports; and
• Updated legal records for domestic
and foreign entities, including entity
type and purpose (for example, holding
company, bank, broker dealer, and
service entity), jurisdiction(s),
ownership, and regulator(s).
Shared and Outsourced Services. The
firm should maintain a fully actionable
implementation plan to ensure the
continuity of shared services that
support identified critical
operations 32 or core business lines, or
are material to the execution of the
resolution strategy, and robust
arrangements to support the continuity
of shared and outsourced services,
including, without limitation,
appropriate plans to retain key
personnel relevant to the execution of
the firm’s strategy. For example,
specified firms should evaluate internal
and external dependencies and develop
documented strategies and contingency
arrangements for the continuity or
replacement of the shared and
outsourced services that are necessary to
maintain identified critical operations
or core business lines, or are material to
the execution of the resolution strategy.
Examples may include personnel,
facilities, systems, data warehouses,
intellectual property, and counsel and
consultants involved in the preparation
for and filing of bankruptcy. Specified
firms also should maintain current cost
estimates for implementing such
strategies and contingency
arrangements.
If a material entity provides shared
services that support identified critical
operations or core business lines, or are
material to the execution of the
resolution strategy, and the continuity
of these shared services relies on the
assumed cooperation, forbearance, or
other non-intervention of regulator(s) in
any jurisdiction, the Plan should
discuss the extent to which the
resolution or insolvency of any other
group entities operating in that same
jurisdiction may adversely affect the
assumed cooperation, forbearance, or
other regulatory non-intervention. If a
32 ‘‘Shared services that support identified critical
operations’’ or ‘‘critical shared services’’ are those
that support identified critical operations
conducted in whole or in material part in the
United States.

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material entity providing shared
services that support identified critical
operations or core business lines, or are
material to the execution of the
resolution strategy, is located outside of
the United States, the Plan should
discuss how the firm will ensure the
operational continuity of such shared
services through resolution.
The firm should:
(A) Maintain an identification of all
shared services that support identified
critical operations or core business
lines, or are material to the execution of
the resolution strategy;
(B) Maintain a mapping of how/where
these services support its core business
lines and identified critical operations;
(C) Incorporate such mapping into
legal entity rationalization criteria and
implementation efforts; and
(D) Mitigate identified continuity
risks through establishment of servicelevel agreements (SLAs) for all shared
services that support identified critical
operations or core business lines, or are
material to the execution of the
resolution strategy.
SLAs should fully describe the
services provided, reflect pricing
considerations on an arm’s-length basis
where appropriate, and incorporate
appropriate terms and conditions to:
(A) Prevent automatic termination
upon certain resolution-related events
and
(B) Achieve continued provision of
such services during resolution.33
The firm should also store SLAs in a
central repository or repositories located
in or immediately accessible from the
U.S. at all times, including in resolution
(and subject to enforceable access
arrangements) in a searchable format. In
addition, the firm should ensure the
financial resilience of internal shared
service providers by maintaining
working capital for six months (or
through the period of stabilization as
required in the firm’s U.S. resolution
strategy) in such entities sufficient to
cover contract costs, consistent with the
U.S. resolution strategy. The firm
should demonstrate that such working
capital is held in a manner that ensures
its availability for its intended purpose.
The firm should identify all critical
service providers and outsourced
services that support identified critical
operations or core business lines, or are
material to the execution of the
resolution strategy, and identify any that
could not be promptly substituted. The
firm should:
33 The firm should consider whether these SLAs
should be governed by the laws of a U.S. state and
expressly subject to the jurisdiction of a court in the
United States.

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(A) Evaluate the agreements governing
these services to determine whether
there are any that could be terminated
upon commencement of any resolution
despite continued performance, and
(B) Update contracts to incorporate
appropriate terms and conditions to
prevent automatic termination upon
commencement of any resolution
proceeding and facilitate continued
provision of such services. Relying on
entities projected to survive during
resolution to avoid contract termination
is insufficient to ensure continuity. In
the Plan, the firm should document the
amendment of any such agreements
governing these services.
Qualified Financial Contracts. The
Plan should reflect the current state of
how the early termination of qualified
financial contracts could impact the
resolution of the firm’s U.S. operations,
including potential termination of any
contracts that are not subject to
contractual or regulatory stays of crossdefault rights. Specifically, the Plan is
expected to reflect the firm’s progress
regarding contractual stays in qualified
financial contracts as of the date the
firm submits its Plan or as of a specified
earlier date. A firm that has adhered to
the International Swaps and Derivatives
Association’s (ISDA) 2018 U.S.
Resolution Stay Protocol or its
antecedent, ISDA’s 2015 Universal
Resolution Stay Protocol (together, the
Protocols) should discuss the extent of
the firm’s adherence to the Protocols in
its Plan (and may also discuss the
impact on U.S. operations of the firm’s
adherence to ISDA’s 2016 Jurisdictional
Modular Protocol on its non-U.S.
operations). A Plan should also explain
the firm’s processes for entering
bilateral contracts with third-party
entities that do not adhere to the
Protocols and provide examples of the
contractual language that is used under
those circumstances.
U.S. MPOE
Payment, Clearing, and Settlement
Activities Capabilities. The firm is
expected to have and describe
capabilities to understand, for each U.S.
material entity, the obligations and
exposures associated with PCS
activities, including contractual
obligations and commitments. For
example, firms should be able to:
• As users of PCS services:
Æ Track the following items by: (i)
U.S. material entity; and (ii) with
respect to customers, counterparties,
and agents and service providers,
location and jurisdiction:
D PCS activities, with each activity
mapped to the relevant material entities,

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identified critical operations, and core
business lines;
D Customers and counterparties for
PCS activities, including values and
volumes of various transaction types, as
well as used and unused capacity for all
lines of credit;
D Exposures to and volumes
transacted with FMUs, nostro agents,
and custodians; and
D Services provided and service level
agreements, as applicable, for other
current agents and service providers
(internal and external).
Æ Assess the potential effects of
adverse actions by FMUs, nostro agents,
custodians, and other agents and service
providers, including suspension or
termination of membership or services,
on the firm’s U.S. operations and
customers and counterparties of those
U.S. operations;
Æ Develop contingency arrangements
in the event of such adverse actions; and
Æ Quantify the liquidity needs and
operational capacity required to meet all
PCS obligations, including intraday
requirements.
• As providers of PCS services:
Æ Identify their PCS clients of their
U.S operations and the services they
provide to these clients, including
volumes and values of transactions;
Æ Quantify and explain time-sensitive
payments; and
Æ Quantify and explain intraday
credit provided.
Managing, Identifying and Valuing
Collateral. The firm is expected to have
and describe its capabilities to manage,
identify, and value the collateral that
the U.S. non-branch material entities
receive from and post to external parties
and affiliates, including tracking
collateral received, pledged, and
available at the CUSIP level and
measuring exposures.
Management Information Systems.
The firm should have the management
information systems (MIS) capabilities
to readily produce data on a U.S. legal
entity basis (including any U.S. branch)
and have controls to ensure data
integrity and reliability. The firm also
should perform a detailed analysis of
the specific types of financial and risk
data that would be required to execute
the U.S. resolution strategy. The firm
should have the capabilities to produce
the following types of information, as
applicable, in a timely manner and
describe these capabilities in the Plan:
• Financial statements for each
material entity (at least monthly);
• External and inter-affiliate credit
exposures, both on- and off-balance
sheet, by type of exposure, counterparty,
maturity, and gross payable and
receivable;

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• Gross and net risk positions with
internal and external counterparties;
• Guarantees, cross holdings,
financial commitments and other
transactions between material entities;
• Data to facilitate third-party
valuation of assets and businesses,
including risk metrics;
• Key third-party contracts, including
the provider, provider’s location,
service(s) provided, legal entities that
are a party to or a beneficiary of the
contract, and key contractual rights (for
example, termination and change in
control clauses);
• Legal agreement information,
including parties to the agreement and
key terms and interdependencies (for
example, change in control,
collateralization, governing law,
termination events, guarantees, and
cross-default provisions);
• Service level agreements between
affiliates, including the service(s)
provided, the legal entity providing the
service, legal entities receiving the
service, and any termination/
transferability provisions;
• Licenses and memberships to all
exchanges and value transfer networks,
including FMUs;
• Key management and support
personnel, including dual-hatted
employees, and any associated retention
agreements;
• Agreements and other legal
documents related to property,
including facilities, technology systems,
software, and intellectual property
rights. The information should include
ownership, physical location, where the
property is managed and names of legal
entities and lines of business that the
property supports; and
• Updated legal records for domestic
and foreign entities, including entity
type and purpose (for example, holding
company, bank, broker dealer, and
service entity), jurisdiction(s),
ownership, and regulator(s).
Shared and Outsourced Services. The
firm should maintain robust
arrangements to support the continuity
of shared and outsourced services that
support any identified critical
operations, or are material to the
execution of the U.S. resolution strategy,
including appropriate plans to retain
key personnel relevant to the execution
of the firm’s strategy. For example,
specified firms should evaluate internal
and external dependencies and develop
documented strategies and contingency
arrangements for the continuity or
replacement of the shared and
outsourced services that are necessary to
maintain identified critical operations
or are material to the execution of the
U.S. resolution strategy. Examples may

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include personnel, facilities, systems,
data warehouses, intellectual property,
and counsel and consultants involved in
the preparation for and filing of
bankruptcy. Specified firms also should
maintain current cost estimates for
implementing such strategies and
contingency arrangements. If a material
entity provides shared services that
support identified critical operations,34
or are material to the execution of the
U.S. resolution strategy, and the
continuity of these shared services relies
on the assumed cooperation,
forbearance, or other non-intervention
of regulator(s) in any jurisdiction, the
Plan should discuss the extent to which
the resolution or insolvency of any other
group entities operating in that same
jurisdiction may adversely affect the
assumed cooperation, forbearance, or
other regulatory non-intervention. If a
material entity providing shared
services that support identified critical
operations, or are material to the
execution of the U.S. resolution strategy,
is located outside of the United States,
the Plan should discuss how the firm
will ensure the operational continuity of
such shared services through resolution.
The firm should:
(A) Maintain an identification of all
shared services that support identified
critical operations or are material to the
execution of the U.S. resolution strategy,
and
(B) Mitigate identified continuity risks
through establishment of SLAs for all
shared services supporting identified
critical operations or are material to the
execution of the U.S. resolution strategy.
SLAs should fully describe the services
provided and incorporate appropriate
terms and conditions to:
(A) Prevent automatic termination
upon certain resolution-related events;
and
(B) Achieve continued provision of
such services during resolution.35
The firm should identify all critical
service providers and outsourced
services that support identified critical
operations or are material to the
execution of the U.S. resolution strategy.
Any of these services that cannot be
promptly substituted should be
identified in a firm’s Plan. The firm
should:
(A) Evaluate the agreements governing
these services to determine whether
there are any that could be terminated
upon commencement of any resolution
despite continued performance; and
34 This should be interpreted to include data
access and intellectual property rights.
35 The firm should consider whether these SLAs
should be governed by the laws of a U.S. state and
expressly subject to the jurisdiction of a court in the
United States.

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(B) Update contracts to incorporate
appropriate terms and conditions to
prevent automatic termination upon
commencement of any resolution
proceeding and facilitate continued
provision of such services.
Relying on entities projected to
survive during resolution to avoid
contract termination is insufficient to
ensure continuity. In the Plan, the firm
should document the amendment of any
such agreements governing these
services.
VII. Branches
U.S. SPOE & U.S. MPOE
Continuity of Operations. If the Plan
assumes that federal or state regulators,
as applicable, do not take possession of
any U.S. branch that is a material entity,
the Plan should support that
assumption.
For any U.S. branch that is a material
entity, the Plan should describe and
demonstrate how the branch would
continue to facilitate FMU access for
identified critical operations and meet
funding needs. For such a U.S. branch,
the Plan should describe how it would
meet supervisory requirements imposed
by state regulators or the appropriate
Federal banking agency, as appropriate,
including maintaining a net due to
position and complying with
heightened asset maintenance
requirements.36 In addition, the Plan
should describe how such a U.S.
branch’s third-party creditors would be
protected such that the state regulator or
appropriate Federal banking agency
would allow the branch to continue
operations.
Impact of the Cessation of Operations.
The Plan should provide an analysis of
the impact of the cessation of operations
of any U.S. branch that is a material
entity on the firm’s FMU access and
identified critical operations, even if
such scenario is not contemplated as
part of the U.S. resolution strategy. The
analysis should include a description of
how identified critical operations could
be transferred to a U.S. IHC subsidiary
or sold in resolution, the obstacles
presented by the cessation of shared
services that support identified critical
operations provided by any U.S. branch
that is a material entity, and mitigants
that could address such obstacles in a
timely manner.
36 Firms should take into consideration historical
practice, by applicable regulators, regarding asset
maintenance requirements imposed during stress.

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VIII. Legal Entity Rationalization and
Separability

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Legal Entity Rationalization
U.S. SPOE
Legal Entity Rationalization Criteria
(LER Criteria). A firm should develop
and implement legal entity
rationalization criteria that support the
firm’s U.S. resolution strategy and
minimize risk to U.S. financial stability
in the event of resolution. LER Criteria
should consider the best alignment of
legal entities and business lines to
improve the resolvability of U.S.
operations under different market
conditions. LER Criteria should govern
the corporate structure and
arrangements between the U.S.
subsidiaries and U.S. branches in a way
that facilitates resolvability of the firm’s
U.S. operations as the firm’s U.S.
activities, technology, business models,
or geographic footprint change over
time.
Specifically, application of the criteria
should:
(A) Ensure that the allocation of
activities across the firm’s U.S. branches
and U.S. nonbranch material entities
support the firm’s U.S. resolution
strategy and minimize risk to U.S.
financial stability in the event of
resolution;
(B) Facilitate the recapitalization and
liquidity support of U.S. IHC
subsidiaries, as required by the firm’s
U.S. resolution strategy. Such criteria
should include clean lines of ownership
and clean funding pathways between
the foreign parent, the U.S. IHC, and
U.S. IHC subsidiaries;
(C) Facilitate the sale, transfer, or
wind-down of certain discrete
operations within a timeframe that
would meaningfully increase the
likelihood of an orderly resolution in
the United States, including provisions
for the continuity of associated services
and mitigation of financial, operational,
and legal challenges to separation and
disposition;
(D) Adequately protect U.S.
subsidiary IDIs from risks arising from
the activities of any nonbank U.S.
subsidiaries (other than those that are
subsidiaries of an IDI); and
(E) Minimize complexity that could
impede an orderly resolution in the
United States and minimize redundant
and dormant entities.
These criteria should be built into the
firm’s ongoing process for creating,
maintaining, and optimizing the firm’s
U.S. structure and operations on a
continuous basis. Finally, the Plan
should include a description of the
firm’s legal entity rationalization
governance process.

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U.S. MPOE
Legal Entity Structure. A firm should
maintain a legal entity structure that
supports the firm’s U.S. resolution
strategy and minimizes risk to U.S.
financial stability in the event of the
resolution of the firm’s U.S. operations.
The firm should consider factors such as
business activities; banking group
structures and booking models and
practices; and potential sales, transfers,
or wind-downs during resolution. The
Plan should describe how the firm’s
U.S. legal entity structure aligns core
business lines and any identified critical
operations with the firm’s material
entities to support the firm’s U.S.
resolution strategy. To the extent a
material entity IDI relies upon an
affiliate that is not the IDI’s subsidiary
during resolution of its U.S. entities,
including for the provision of shared
services, the firm should discuss its
rationale for the legal entity structure
and associated resolution risks and
potential mitigants.
The firm’s corporate structure and
arrangements among U.S. legal entities
should be considered and maintained in
a way that facilitates the firm’s
resolvability as its activities, technology,
business models, or geographic footprint
change over time.
Separability
U.S. SPOE
Separability. The firm should
identify discrete U.S. operations that
could be sold or transferred in
resolution, with the objective of
providing optionality in resolution
under different market conditions.
A firm’s separability options should
be actionable, and impediments to their
projected mitigation strategies should be
identified in advance. Firms should
consider potential consequences for
U.S. financial stability of executing each
option, taking into consideration
impacts on counterparties, creditors,
clients, depositors, and markets for
specific assets. The level of detail and
analysis should vary based on a firm’s
risk profile and scope of operations.
Additionally, information systems
should be robust enough to produce the
required data and information needed to
execute separability options.
Further, the firm should have, and be
able to demonstrate, the capability to
populate in a timely manner a data
room with information pertinent to a
potential divestiture of the identified
separability options (including, but not
limited to, carve-out financial
statements, valuation analysis, and a
legal risk assessment). Within the Plan,
the firm should demonstrate how the

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firm’s LER Criteria and implementation
efforts support meeting the separabilityrelated guidance above. The Plan should
also provide the separability analysis
noted above.
U.S. MPOE
A Plan should include options for the
sale, transfer, or disposal of U.S.
significant assets, portfolios, legal
entities, or business lines in resolution
that may be executed in a reasonable
period of time. For each option,
supporting analysis should include: an
execution plan that includes an
estimated time frame for
implementation, a description of any
impediments to execution of the option,
and mitigation strategies to address
those impediments; a description of the
assumptions underpinning the option; a
financial impact assessment that
describes the impact of executing the
option; and an identified critical
operation impact assessment that
describes how execution of the option
may affect the provision of any
identified critical operation. Information
systems should be robust enough to
produce the required data and
information needed to execute the
options.
IX. Insured Depository Institution
Resolution
U.S. MPOE
Least-cost requirement analysis. If the
Plan includes a strategy that
contemplates the separate resolution of
a U.S. IDI that is a material entity, the
Plan should explain how the resolution
could be achieved in a manner that is
consistent with the overall objective of
the Plan to substantially mitigate the
risk that the failure of the specified firm
would have serious adverse effects on
financial stability in the United States
while also complying with the statutory
and regulatory requirements governing
IDI resolution.
This explanation does not include an
expectation that firms provide a
complete least-cost analysis. A complete
least-cost analysis would, for example,
include a comparison of the preferred
strategy for resolving an IDI that is a
material entity against every other
possible resolution method available for
that IDI.
To explain how a firm’s preferred
strategy could potentially enable the
FDIC to resolve the failed bank in a
manner consistent with the FDIC’s
statutory least-cost requirement, the
firm could instead compare the
estimated costs to the DIF of the firm’s
preferred resolution strategy to a payout
liquidation and, for strategies involving

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a BDI, explain how the inclusion or
exclusion of uninsured deposits within
the BDI would impact the estimated
overall costs to the DIF.
Firms should address the following
matters as applicable to their strategy:
• Payout Liquidation: If the Plan
envisions a payout liquidation for the
IDI, with or without use of a Deposit
Insurance National Bank or a paying
agent, the Plan should explain how the
deposit payout and asset liquidation
process would be executed in a manner
that substantially mitigates the risk of
serious adverse effects on U.S. financial
stability.
• P&A Transaction: If the Plan
assumes a weekend P&A strategy, the
plan should first demonstrate the ready
availability of this option under severely
adverse economic scenario, assuming
that markets are functioning and
competitors are in a position to take on
business. The Plan may demonstrate a
weekend P&A strategy is available by
discussing evidence of several potential
buyers supported by information
indicating that these potential buyers
could reasonably be expected to have
sufficient financial resources to
complete the transaction in a severely
adverse scenario and the expertise to
incorporate the business of the failed
bank. The plan should also address how
such a merger can be completed with
these potential acquirers considering
any applicable approvals that would be
required for the proposed transaction.
Additionally, a P&A strategy should
explain how it either (1) results in no
loss to the DIF or (2) despite its resulting
in a loss to the DIF, the loss is less than
would be incurred through a payout
liquidation.
• All-Deposit BDI: If the Plan
contemplates a strategy involving an alldeposit BDI, the Plan should include an
analysis that shows that the incremental
estimated cost to the DIF of transferring
all uninsured deposits to the BDI is
offset by the preservation of franchise
value and other benefits connected to
the uninsured deposits (such as the
franchise value derived from retaining
full banking relationships).
• BDI with Partial Uninsured Deposit
Transfers: A Plan may demonstrate the
feasibility of a strategy involving a BDI
that assumes (1) all insured deposits or
(2) only a portion of uninsured deposits
(e.g. an advance dividend to uninsured
depositors for a portion of their deposit
claim) by showing that the incremental
estimated cost to the DIF of transferring
the portion of uninsured deposits to the
BDI is offset by the preservation of
franchise value connected to those
uninsured deposits (such as the

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franchise value derived from retaining
full banking relationships).
In all cases, the Plan should discuss
how the implementation of the Plan’s
resolution strategy, including the impact
on any depositors whose accounts are
not transferred in whole or in part to a
BDI, would not be likely to create the
risk of serious adverse effects on U.S.
financial stability.
Valuation. Regardless of the strategy
chosen, the Plan should demonstrate
reasonable and well-supported
assumptions that support the valuation
of the failed IDI’s assets and business
franchise under the firm’s preferred
strategy that are drawn from comparable
transactions or other inputs observable
in the marketplace. A firm’s franchise
value is generally understood to be the
value of the bank as an operating
company relative to the value of the
firm’s individual assets minus its
liabilities. In assessing the franchise
value of the firm’s business, the Plan
could provide support through relevant
inputs such as the revenue generated by
the account relationships; the
efficiencies in administrative costs
associated with servicing large deposits/
large relationships; the elimination of
barriers to entry or the reduction in
customer acquisition costs; growth
history and prospects for the products
or business activity; market trading or
sales multiples; or any other factors the
firm believes appropriate. Asset values
should be representative of the bank’s
asset mix under the appropriate
economic conditions and of sufficient
distress as to result in failure.
Exit from BDI. A Plan should include
a discussion of the eventual exit from
the BDI. A Plan could support the
feasibility of an exit strategy by, for
example, describing an actionable
process, based on historical precedent
or otherwise supportable projections,
that winds down certain businesses,
includes the sale of assets and the
transfer of deposits to one or multiple
acquirers, or culminates in a capital
markets transaction, such as an initial
public offering or a private placement of
securities.
X. Format and Structure of Plans;
Assumptions
U.S. SPOE & U.S. MPOE
Format of Plan
Executive Summary. The Plan should
contain an executive summary
consistent with the Rule, which must
include, among other things, a concise
description of the key elements of the
firm’s strategy for an orderly resolution.
In addition, the executive summary
should include a discussion of the

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66539

firm’s assessment of any impediments to
the firm’s U.S. resolution strategy and
its execution, as well as the steps it has
taken to address any identified
impediments.
Narrative. The Plan should include a
strategic analysis consistent with the
Rule. This analysis should take the form
of a concise narrative that enhances the
readability and understanding of the
firm’s discussion of its strategy for an
orderly resolution in bankruptcy or
other applicable insolvency regimes
(Narrative).
Appendices. The Plan should contain
a sufficient level of detail and analysis
to substantiate and support the strategy
described in the Narrative. Such detail
and analysis should be included in
appendices that are distinct from and
clearly referenced in the related parts of
the Narrative (Appendices).
Public Section. The Plan must be
divided into a public section and a
confidential section consistent with the
requirements of the Rule.
Other Informational Requirements.
The Plan must comply with all other
informational requirements of the Rule.
The firm may incorporate by reference
previously submitted information as
provided in the Rule.
Guidance Regarding Assumptions
1. The Plan should be based on the
current state of the applicable legal and
policy frameworks. Pending legislation
or regulatory actions may be discussed
as additional considerations.
2. The firm must submit a Plan that
does not rely on the provision of
extraordinary support by the United
States or any other government to the
firm or its subsidiaries to prevent the
failure of the firm.37 The firm should
not submit a Plan that assumes the use
of the systemic risk exception to the
least-cost test in the event of a failure of
an IDI requiring resolution under the
FDI Act.
3. The firm should not assume that it
will be able to sell identified critical
operations or core business lines, or that
unsecured funding will be available
immediately prior to filing for
bankruptcy.
4. The Plan should assume the DoddFrank Act Stress Test (DFAST) severely
adverse scenario for the first quarter of
the calendar year in which the Plan is
submitted is the domestic and
international economic environment at
the time of the firm’s failure and
throughout the resolution process.
5. The U.S. resolution strategy may be
based on an idiosyncratic event or
action, including a series of
37 12

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compounding events. The firm should
justify use of that assumption,
consistent with the conditions of the
economic scenario.
6. Within the context of the applicable
idiosyncratic scenario, markets are
functioning and competitors are in a
position to take on business. If a firm’s
Plan assumes the sale of assets, the firm
should take into account all issues
surrounding its ability to sell in market
conditions present in the applicable
economic condition at the time of sale
(i.e., the firm should take into
consideration the size and scale of its
operations as well as issues of
separation and transfer).
7. For a firm that adopts a U.S. MPOE
resolution strategy, the Plan should
demonstrate and describe how the
failure event(s) results in material
financial distress of the U.S.
operations.38 In particular, the Plan
should consider the likelihood that
there would be a diminution of the
firm’s liquidity buffer in the stress
period prior to filing for bankruptcy
from high unexpected outflows of
deposits and increased liquidity
requirements from counterparties.
Though the immediate failure event
may be liquidity-related and associated
with a lack of market confidence in the
financial condition of the covered
company or its material legal entity
subsidiaries prior to the final
recognition of losses, the demonstration
and description of material financial
distress may also include depletion of
capital. Therefore, the Plan should also
consider the likelihood of the depletion
of capital.
8. The firm should not assume any
waivers of section 23A or 23B of the
Federal Reserve Act in connection with
the actions proposed to be taken prior
to or in resolution.
9. The Plan should support any
assumptions that the firm will have
access to the Discount Window and/or
other borrowings during the period
immediately prior to entering
bankruptcy. To the extent the firm
assumes use of the Discount Window,
Federal Home Loan Banks, and/or other
borrowings, the Plan should support
that assumption with a discussion of the
operational testing conducted to
facilitate access in a stress environment,
placement of collateral, and the amount
of funding accessible to the firm. The
firm may assume that its depository
institutions will have access to the
Discount Window only for a few days
38 See Section 11(c)(5) of the FDI Act, codified at
11 U.S.C. 1821(c)(5), which details grounds for
appointing the FDIC as conservator or receiver of
an IDI.

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after the point of failure to facilitate
orderly resolution. However, the firm
should not assume its subsidiary
depository institutions will have access
to the Discount Window while critically
undercapitalized, in FDIC receivership,
or operating as a bridge bank, nor
should it assume any lending from a
Federal Reserve credit facility to a nonbank affiliate.
Financial Statements and Projections.
The Plan should include the actual
balance sheet for each material entity
and the consolidating balance sheet
adjustments between material entities as
well as pro forma balance sheets for
each material entity at the point of
failure and at key junctures in the
execution of the U.S. resolution strategy.
It should also include statements of
projected sources and uses of funds for
the interim periods. The pro forma
financial statements and accompanying
notes in the Plan should clearly
evidence the failure trigger event; the
Plan’s assumptions; and any
transactions that are critical to the
execution of the Plan’s preferred
strategy, such as recapitalizations, the
creation of new legal entities, transfers
of assets, and asset sales and unwinds.
Material Entities. Material entities
should encompass those entities,
including subsidiaries, branches and
agencies (collectively, Offices), which
are significant to the activities of an
identified critical operation or core
business line. If the abrupt disruption or
cessation of a core business line might
have systemic consequences to U.S.
financial stability, the entities essential
to the continuation of such core
business line should be considered for
material entity designation. Material
entities should include the following
types of entities:
1. Any Office, wherever located, that
is significant to the activities of an
identified critical operation.
2. Any Office, wherever located,
whose provision or support of global
treasury operations, funding, or
liquidity activities (inclusive of
intercompany transactions) is
significant to the activities of an
identified critical operation.
3. Any Office, wherever located, that
would provide material operational
support in resolution (key personnel,
information technology, data centers,
real estate or other shared services) to
the activities of an identified critical
operation.
4. Any Office, wherever located, that
is engaged in derivatives booking
activity that is significant to the
activities of an identified critical
operation, including those that conduct

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either the internal hedge side or the
client-facing side of a transaction.
5. Any Office, wherever located,
engaged in asset custody or asset
management that are significant to the
activities of an identified critical
operation.
6. Any Office, wherever located,
holding licenses or memberships in
clearinghouses, exchanges, or other
FMUs that are significant to the
activities of an identified critical
operation.
For each material entity (including a
branch), the Plan should enumerate, on
a jurisdiction-by-jurisdiction basis, the
specific mandatory and discretionary
actions or forbearances that regulatory
and resolution authorities would take
during resolution, including any
regulatory filings and notifications that
would be required as part of the U.S.
resolution strategy, and explain how the
Plan addresses the actions and
forbearances. The Plan should describe
the consequences for the firm’s U.S.
resolution strategy if specific actions in
each jurisdiction were not taken,
delayed, or forgone, as relevant.
XI. Public Section
U.S. SPOE & U.S. MPOE
The purpose of the public section is
to inform the public’s understanding of
the firm’s U.S. resolution strategy and
how it works.
The public section should discuss the
steps that the firm is taking to improve
resolvability under the U.S. Bankruptcy
Code. The public section should
provide background information on
each material entity and should be
enhanced by including the firm’s
rationale for designating material
entities. The public section should also
discuss, at a high level, the firm’s intragroup financial and operational
interconnectedness (including the types
of guarantees or support obligations in
place that could impact the execution of
the firm’s strategy).
The discussion of strategy in the
public section should broadly explain
how the firm has addressed any
deficiencies, shortcomings, and other
key vulnerabilities that the agencies
have identified in prior plan
submissions. For each material entity, it
should be clear how the strategy
provides for continuity, transfer, or
orderly wind-down of the entity and its
operations. There should also be a
description of the resulting organization
upon completion of the resolution
process.
The public section may note that the
Plan is not binding on a bankruptcy
court or other resolution authority and

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that the proposed failure scenario and
associated assumptions are hypothetical
and do not necessarily reflect an event
or events to which the firm is or may
become subject.

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By order of the Board of Governors of the
Federal Reserve System.
Ann E. Misback,
Secretary of the Board.

Dated at Washington, DC, on August 9,
2024.
James P. Sheesley,
Assistant Executive Secretary.

Federal Deposit Insurance Corporation.
By order of the Board of Directors.

[FR Doc. 2024–18186 Filed 8–14–24; 8:45 am]

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BILLING CODE 6210–01–P; 6714–01–P

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