FRB and FDIC Proposes to Modify Rule Implementing Resolution Planning Requirements

The Federal Reserve Board ("FRB") and FDIC (collectively, the agencies) proposed to amend and "restate" the rule implementing the resolution planning requirements of Dodd-Frank Act Section 165(d). The proposed amendments to the rule include a proposal: (i) by the FRB to create "risk-based categories" for determining the application of the resolution planning requirement to specific U.S. and foreign banking organizations and (ii) by the agencies to extend the "default resolution plan filing cycle" and permit more focused resolution plan submissions.

The agencies stated that the proposal is intended to enhance the resolution plan submission and review process and timelines. In addition, the agencies noted that the proposal has three chief goals: (i) the proposal is intended to enhance efficiency and "balance burden" by permitting more focused full resolution plan submissions; (ii) the proposal would devise by a rule a biennial filing cycle for the U.S. globally systemically important banks and "balance burden" by extending the filing cycle to every three years for all other filers; and (iii) the proposal would enhance aspects of the rule (i.e., the process for identifying "critical operations").

Specifically, the agencies' proposal:

• separates the firms that have resolution planning requirements into "groups of filers for plan content tailoring purposes";
• improves transparency and supplies more predictability by formalizing the current "reduced resolution plan category";
• devises multi-year submission cycles for each group of filers;
• "[i]ntroduces a new category of plans distinguished by informational content";
• "supersedes the existing tailored plan category"; and
• improves certain procedural elements of the rule.

Comments on the proposal must be submitted by June 21, 2019.