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June 20, 2024

The FDIC’s Rule on Resolution Planning is Not Strong Enough to End the Contagion, Chaos, Costs, And Bailouts From Large Bank Failures

WASHINGTON, D.C.— Today, the Federal Deposit Insurance Corporation (FDIC) finalized a new rule on resolution plans for large banks. Shayna Olesiuk, Director of Banking Policy, released the following statement.

“The failures, contagion, chaos, costs, and bailouts of Silicon Valley Bank, First Republic Bank, and Signature Bank did not have to happen, should not have happened, and would not have happened if they had current, workable resolution plans. Such planning, especially for large banks, is critically important to prevent those banks from endangering the entire financial system and the American public.

“Large banks must be held accountable for preparing and maintaining robust resolution plans, with enough information to prevent a default or a GSIB (global systemically important bank) takeover, as occurred with JPMorgan’s acquisition of First Republic. Furthermore, banking regulators must strengthen their own capabilities to engage frequently and constructively with banks throughout the resolution planning process.

“While the final rule approved by the FDIC today makes certain needed improvements to increase and expand the information that banks must provide to the FDIC to facilitate a potential resolution, it misses a critical opportunity to increase the frequency of resolution plan filings.

“The final rule moved in the wrong direction, putting in place a schedule of banks only being required to file resolution plans every three years, instead of the biennial cadence put forth in the FDIC’s original proposal, or a requirement to file plans every year as we recommended. The cost and consequences of long delays between resolution plans were made crystal clear in spring 2023. Silicon Valley Bank and First Republic Bank had filed resolution plans a few months before their failures, but the FDIC had not completed a review of the plans or provided feedback. Signature Bank had never filed a resolution plan before its failure. Unfortunately the rule approved today expands the possibility that time lags and data gaps like these will continue to threaten financial stability.”

You can find our comment letter on the proposal here.


Better Markets is a non-profit, non-partisan, and independent organization founded to promote the public interest in the financial markets, support the financial reform of Wall Street and make our financial system work for all Americans again. Better Markets works with allies—including many in finance—to promote pro-market, pro-business and pro-growth policies that help build a stronger, safer financial system that protects and promotes Americans’ jobs, savings, retirements and more. To learn more, visit

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