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Press Release
Published December 19, 2017
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Big U.S. banks get satisfactory grades on living wills

Date: December 19, 2017
Categories: Operational Risk Management, Performance Measurement and Management, Risk & Performance
Keywords: Bank Of America, Goldman Sachs, Citigroup, JP Morgan, Morgan Stanley, Wells Fargo, Living Will, Dificiencies


The eight largest and most complex U.S. banks avoided a major rebuke on their latest "living will" bailout-prevention plans, a milestone that further reduces the already-remote possibility that any of the firms would be broken up by the government.
 
U.S. regulators said the eight firms, including Bank of America Corp. (BAC) , Goldman Sachs Group Inc. (GS) , Citigroup Inc. (C) , JPMorgan Chase & Co. (JPM) , Morgan Stanley (MS) and Wells Fargo & Co. (WFC) , didn't have "deficiencies" in plans documenting how they could go bankrupt without needing a taxpayer bailout.
 
That was a reversal from April 2016, when the Federal Reserve and Federal Deposit Insurance Corp. shocked the firms by determining five of eight had deficiencies.
 
The regulators' 2016 decision had raised the possibility of bank breakups. If the regulators find deficiencies in the firms' plans, the 2010 Dodd-Frank law empowers them to impose significant sanctions and, eventually, force divestitures.
 
Re-disseminated by The Asian Banker from The Wall Street Journal