On Monday, December 1, the Systemic Risk Council wrote a letter to the Financial Stability Board about cross-border recognition of resolution action.
The letter states:
“We commend the Financial Stability Board for its progress in addressing too big to fail, and in particular, addressing the important cross-border issues that can contribute to systemic instability and impede the orderly resolution of a large financial institution. Important work remains to be done before financial markets, policymakers and the public can feel confident that large, globally active financial institutions will be able to fail without destabilizing markets or needing taxpayer support. We applaud the FSB’s recent efforts to secure a protocol for a short stay for derivatives counterparties when bankruptcy courts or resolution entities begin the wind down of a failed large financial institution. We urge the FSB and individual regulators around the world to continue putting in place the policies necessary to protect taxpayers and financial markets from the failure of systemic, global firms.”
Read the full letter below: