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FSB Launches RRP Peer Review

On 3 August 2012 the Financial Stability Board launched a peer review of member jurisdictions’ existing resolution regimes.  The objectives of the review are to:

  • assess the resolution regimes that apply to different types of financial  institutions;
  • highlight good practice, inconsistencies and gaps in national resolution regimes;
  • evaluate progress in implementing reforms to national resolution regimes and identify challenges arising from their implementation; and
  • clarify or revise resolution regime criteria, where necessary.

The review uses the FSB’s “Key Attributes of Effective Resolution Regimes for Financial Institutions” (“Key Attributes”) as a benchmark, but does not directly assess jurisdictions’ compliance with the Key Attributes.  Rather, the intention of the review is to provide a comparative analysis of existing regimes and of progress made by different jurisdictions, both across individual Key Attributes and across different financial sectors (including banking, insurance, securities, financial market infrastructures).  The deadline for the receipt of feedback is 28 September 2012.

The primary source of information for the peer review will be member jurisdictions’ responses to a questionnaire. The questionnaire is divided into two sections.  Section 1 seeks general information about recent experiences, lessons learned and planned reforms with respect to the resolution of  systemically important financial institutions.  Specifically, information is requested as to whether:

  • resolution powers and funding arrangements were generally adequate;
  • public authorities were adequately prepared;
  • there was effective coordination and information sharing between resolution authorities; and
  • sufficient information about the institution and its related entities was available to the relevant authorities.

Section 2 seeks to create an overview of national resolution regimes and assess their consistency with the Key Attributes.  Specifically, it focuses on:

  • the scope and application of existing resolution regimes;
  • the way in which systemic importance is defined;
  • the identity, objectives and powers of resolution authorities;
  • the triggers to resolution;
  • safeguards for creditors;
  • funding of resolution regimes;
  • frameworks for cross-border cooperation;
  • requirements for the preparation of recovery and resolution plans and resolvability assessments; and
  • information access and sharing.
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