[Federal Register Volume 76, Number 211 (Tuesday, November 1, 2011)]
[Rules and Regulations]
[Pages 67323-67340]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-27377]


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FEDERAL RESERVE SYSTEM

12 CFR Part 243

[Regulation QQ; Docket No. R-1414]
RIN 7100-AD73

FEDERAL DEPOSIT INSURANCE CORPORATION

12 CFR Part 381

RIN 3064 AD 77


Resolution Plans Required

AGENCY: Board of Governors of the Federal Reserve System (Board) and 
Federal Deposit Insurance Corporation (Corporation).

ACTION: Final rule.

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SUMMARY: The Board and the Corporation (together the ``Agencies'') are 
adopting this final rule to implement the requirement in a section of 
the Dodd-Frank Wall Street Reform and Consumer Protection Act (the 
``Dodd-Frank Act'') regarding resolution plans. The Dodd-Frank Act 
section requires each nonbank financial company designated by the 
Financial Stability Oversight Council (the ``Council'') for enhanced 
supervision by the Board and each bank holding company with assets of 
$50 billion or more to report periodically to the Board, the 
Corporation, and the Council the plan of such company for rapid and 
orderly resolution in the event of material financial distress or 
failure.

DATES: The rule is effective November 30, 2011.

FOR FURTHER INFORMATION CONTACT: 
    Board: Barbara J. Bouchard, Senior Associate Director, (202) 452-
3072, Michael D. Solomon, Associate Director, (202) 452-3502, or Avery 
I. Belka, Counsel, (202) 736-5691, Division of Banking Regulation and 
Supervision; or Ann E. Misback, Associate General Counsel, (202) 452-
3788, Dominic A. Labitzky, Senior Attorney, (202) 452-3428, or Bao 
Nguyen, Attorney, (202) 736-5599, Legal Division; Board of Governors of 
the Federal Reserve System, 20th and C Streets, NW., Washington, DC 
20551. Users of Telecommunication Device for Deaf (TDD) only, call 
(202) 263-4869.
    Corporation: Joseph Fellerman, Senior Program Analyst, (202) 898-
6591, Office of Complex Financial Institutions, Richard T. Aboussie, 
Associate General Counsel, (703) 562-2452, David N. Wall, Assistant 
General Counsel, (703) 562-2440, Mark A. Thompson, Counsel, (703) 562-
2529, or Mark G. Flanigan, Counsel, (202) 898-7426, Legal Division.

SUPPLEMENTARY INFORMATION: 

I. Background

    To promote financial stability, section 165(d) of the Dodd-Frank 
Act requires each nonbank financial company supervised by the Board and 
each bank holding company with total consolidated assets of $50 billion 
or more (each a ``covered company'') to periodically submit to the 
Board, the Corporation, and the Council a plan for such company's rapid 
and orderly resolution in the event of material financial distress or 
failure. That section also requires each covered company to report on 
the nature and extent of credit exposures of such covered company to 
significant bank holding companies and significant nonbank financial 
companies and the nature and extent of credit exposures of significant 
bank holding companies and significant nonbank financial companies to 
such covered company.\1\ This final rule implements the resolution plan 
requirement set forth in section 165(d)(1) of the Dodd-Frank Act.
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    \1\ See generally 12 U.S.C. 5365(d).
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    Plans filed under section 165(d)(1) will assist covered companies 
and regulators in conducting advance resolution planning for a covered 
company. As demonstrated by the Corporation's experience in failed bank 
resolutions, as well as the Board's and the Corporation's experience in 
the recent crisis, advance planning improves the efficient resolution 
of a covered company. Advance planning has long been a component of 
resiliency and recovery planning by financial companies. The resolution 
plan required of covered companies under this final rule will support 
the Corporation's planning for the exercise of its resolution authority 
under the Dodd-Frank Act and the Federal Deposit Insurance Act (``FDI 
Act'') by providing the Corporation with an understanding of the 
covered companies' structure and complexity as well as their resolution 
strategies and processes. The resolution plan required of covered 
companies under this final rule will also assist the Board in its 
supervisory efforts to ensure that covered companies operate in a 
manner that is both safe and sound and that does not pose risks to 
financial stability generally. In addition, these plans will enhance 
the Agencies' understanding of the U.S. operations of foreign banks and 
improve efforts to develop a comprehensive and coordinated resolution 
strategy for a cross-border firm.
    The final rule requires each covered company to produce a 
resolution plan, or ``living will,'' that includes information 
regarding the manner and extent to which any insured depository 
institution affiliated with the company is adequately protected from 
risks arising from the activities of nonbank subsidiaries of the 
company; detailed descriptions of the ownership structure, assets, 
liabilities, and contractual obligations of the company; identification 
of the cross-guarantees tied to different securities; identification of 
major counterparties; a process for determining to whom the collateral 
of the company is pledged; and other information that the Board and the 
Corporation jointly require by rule or order.\2\ The final rule 
requires a strategic analysis by the covered company of how it can be 
resolved under Title 11 of the U.S. Code (the ``Bankruptcy Code'') in a 
way that would not pose systemic risk to the financial system. In doing 
so, the company must map its core business lines and critical 
operations to material legal entities and provide integrated analyses 
of its corporate structure; credit and other exposures; funding, 
capital, and cash flows; the domestic and foreign jurisdictions in 
which it operates; and its supporting information systems for core 
business lines and critical operations.
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    \2\ See 12 U.S.C. 5365(d)(1).

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[[Page 67324]]

II. Notice of Proposed Rulemaking: Summary of Comments

    On April 22, 2011, the Board and the Corporation invited public 
comment on a Notice of Proposed Rulemaking: Resolution Plans and Credit 
Exposure Reports Required (the ``proposed rule'' or ``proposal'').\3\ 
The comment period ended on June 10, 2011. The Board and the 
Corporation collectively received 22 comment letters from a range of 
individuals and banking organizations, as well as industry and trade 
groups representing banking, insurance, and the broader financial 
services industry. In addition, the Board and the Corporation met with 
industry representatives to discuss issues relating to the proposed 
rule.
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    \3\ 76 FR 22,648 (April 22, 2011).
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    While the commenters generally expressed support for the broader 
goals of the proposed rule to require covered companies to plan for 
their orderly liquidation or restructuring in bankruptcy during times 
of material financial distress, many commenters also expressed concerns 
about various aspects of the proposed rule. The comments the Board and 
the Corporation received fit into four broad categories: comments that 
focused on the resolution planning requirement, including the required 
informational content, of the proposed rule; comments that addressed 
the credit exposure reporting requirement; comments regarding the 
application of the proposed rule to foreign-banking organizations 
(``FBOs''); and comments concerned with the confidential treatment of 
information provided as part of a resolution plan or credit exposure 
report. These comments are summarized below.

i. Substantive Resolution Plan Requirements

    With respect to the resolution plan requirement, some commenters 
suggested that the resolution plan requirement adopt a ``principle-
based'' approach with the specific content of each plan developed 
through the iterative supervisory process, and that the Agencies' 
review of each plan be tied to the scope and planning decided on 
between individual firms and the Agencies as part of that process. In 
contrast, another commenter suggested that the plans be very specific 
and operationally oriented; further suggesting that such plans should 
include, among other things, practice exercises to test readiness and 
detailed descriptions of actions to be taken to facilitate rapid and 
orderly resolution. Similarly, another commenter suggested that the 
final rule should provide detailed guidance regarding the strategic 
analysis, facilitate the creation of a structured data source for 
requested data, and adopt a submission framework to be used in the 
creation and review of the resolution plan. Commenters also suggested 
that the final rule draw a clear distinction between the limited 
resolution plan required by the Dodd-Frank Act and the broader 
resolution planning process that may be required as a prudential 
matter.
    A number of commenters argued that insurance companies and other 
entities that are not subject to the Bankruptcy Code should be exempted 
from the resolution plan requirement, be allowed to file streamlined 
plans, or, where such companies are a part of a covered company, be 
excluded from such covered company's resolution plan. Others questioned 
how a resolution plan should address such entities. One commenter 
suggested that managers of money market funds should be excluded from 
the requirements of the proposed rule. Some commenters specifically 
requested that (i) The final resolution plan requirement reflect and 
conform to section 203(e) of the Dodd-Frank Act, which provides that 
any insurance company that is a covered financial company or a 
subsidiary thereof will be liquidated or rehabilitated under applicable 
state law; and (ii) the Agencies accept as a credible resolution plan 
an insurance company's statement of its intent to submit itself, or its 
insurance subsidiaries, to applicable state liquidation or 
rehabilitation regimes.
    One commenter suggested that the scope of the final rule should go 
beyond bankruptcy and should explicitly address questions of legal 
jurisdiction and conflicting laws. This commenter argued that a 
resolution plan should be supported by a legal opinion addressing which 
law would apply to each of the covered company's material entities in 
the case of the covered company's resolution. On the other hand, 
another commenter requested that the final rule provide only that the 
resolution plan analyze how the continuing operations of a covered 
company's insured depository institutions can be adequately protected 
in connection with the resolution of the company under the Bankruptcy 
Code. Still another commenter suggested that resolution under the 
Bankruptcy Code was inconsistent with the requirement that a covered 
company's resolution plan adequately protect the company's insured 
depository institution from the risks arising from the activities of 
the company's nonbanks because the covered company cannot provide any 
assurances of what will happen in a bankruptcy proceeding and cannot 
provide special protection for a particular subsidiary in the 
bankruptcy process.
    A number of comments expressed concern about the timing of the 
initial submission of a resolution plan. Commenters argued that the 
requirement to submit initial plans 180 days from the effective date of 
the final rule is too short. Instead, these commenters suggested that 
covered companies should have at least 270 days, 360 days, or 18 months 
after the effective date of the final rule to make their initial 
submissions. Commenters suggested that submissions of the resolution 
plan be phased in or staggered to allow firms sufficient time to 
prepare and collect the extensive information required as part of the 
plan. Another commenter suggested a pilot program that would apply 
first to the largest, most complex firms, rolling out the entire 
process on a staggered basis after experience is gained with the 
largest firms.
    Commenters also criticized the proposed rule for not adjusting the 
complexity of the reporting requirements to match the differences among 
bank holding companies subject to the proposed rule. These commenters 
noted that covered banking organizations range from large, complex, 
highly interconnected organizations that have substantial nonbank and 
foreign operations to smaller, less complex organizations that are 
predominantly composed of one or more insured depository institutions, 
have few foreign operations, and fewer interconnections with other 
financial institutions. These commenters suggested that the final rule 
provide for a tailored resolution plan regime for smaller, less complex 
domestic bank holding companies.
    Several commenters suggested that, given the lack of supervisory 
and market experience with resolution planning, the final rule should 
communicate the Board's and the Corporation's expectations for ``first 
generation'' resolution plans and should provide for meaningful 
feedback by the Agencies within the 60 day period the Agencies have to 
review an initial resolution plan. Commenters also noted that annual 
updates to the plan should not be due at the end of the first calendar 
quarter when firms have to meet other important reporting requirements. 
Commenters suggested that the timing of the annual update should be 
determined by agreement among the

[[Page 67325]]

Board, the Corporation, and the covered company.
    The proposed rule required interim updates to a resolution plan 
shortly after any material acquisition or similar event. One commenter 
argued that the requirement was not supported by the Dodd-Frank Act and 
should be excluded from the final rule. Other commenters suggested 
that, if the final rule required interim updates, such updates should 
be triggered by a ``fundamental change'' standard instead of the 
material change standard described in the proposed rule. Some 
commenters suggested that the size of events that trigger the update 
requirement be raised and the time period for filing the update be 
extended.
    The proposal required that, within a reasonable amount of time 
after submitting its initial resolution plan, a firm demonstrate its 
capacity to promptly produce the data underlying the key aspects of its 
resolution plan. Commenters objected to this requirement indicating 
that it would be better addressed as part of the Board's and 
Corporation's ongoing review of the resolution-planning process 
conducted by individual firms, rather than as a regulatory requirement. 
Similarly, commenters suggested that any requirement related to data 
production capabilities be omitted from the final rule because such a 
requirement is better addressed as part of the Agencies' ongoing review 
of resolution planning by specific companies. Commenters also 
recommended that data required to be collected through various Dodd-
Frank Act initiatives be coordinated to minimize redundant data 
collections. Other commenters recommended that covered companies' 
information technology systems be able to integrate and distribute 
essential structural and operational information on short notice to 
facilitate such companies' resolutions.
    Some commenters objected to the requirement that multiple stress 
scenarios be addressed as part of the plan as burdensome and 
unworkable. The commenters suggested that the number of financial 
distress scenarios to be addressed in a covered company's resolution 
plan should be limited, with the specific number of scenarios to be 
agreed to between the covered company and the Agencies prior to the 
initial submission. Commenters also expressed concern about having to 
address a systemic stress scenario, which commenters considered more 
appropriately related to the Orderly Liquidation Authority in Title II 
of the Dodd-Frank Act.
    Some commenters criticized the corporate governance requirement of 
the proposed rule. These commenters suggested that a covered company's 
corporate governance with regard to resolution planning, unless 
determined to be substantially defective in one or more respects, 
should be deemed to facilitate orderly resolution, as well as to be 
informationally complete and credible. Another commenter suggested that 
the corporate governance requirement should include requirements for 
consistently maintaining accurate asset valuations.
    Commenters also noted the burdens nonbank financial companies will 
face. Where such firms have established an intermediate holding company 
(``IHC''), commenters asked that the resolution plan requirement apply 
only to the IHC. These commenters also suggested that nonbank financial 
firms be permitted to complete any restructuring involved in the 
establishment of their IHC before commencing resolution planning. 
Commenters also asserted that the requirement to provide an 
unconsolidated balance sheet and consolidating schedules was unduly 
burdensome, costly, and impracticable.
    A number of commenters expressed concern about how the Board and 
the Corporation will determine whether a plan is not credible or 
deficient and the possible ramifications of such a determination. Some 
commenters requested clarification of the standards relevant to such a 
determination, and others suggested that these standards should be 
developed over time. Several commenters sought clarification of whether 
a covered company's board of directors (or its delegee in the case of a 
foreign-based covered company) is required to certify or confirm all 
the factual information contained in the company's resolution plan. One 
commenter asked whether an interim update involves the submission of an 
entire resolution plan or merely involves additional information 
describing the event triggering the update, any effects the event has 
on the plan, and the firm's actions to address such effects.
    The Board and the Corporation were also asked to clarify the 
relationship that insolvency regimes other than bankruptcy bear on the 
preparation and assessment of a resolution plan. Commenters also asked 
the Agencies to confirm that the rule is not intended to restrain the 
covered companies from expanding through mergers, acquisitions, or 
diversification of their business; that the resolution plan is not 
meant to impose on firms the need to have duplicative capacity; and 
that the Agencies will take into account the companies' own cost-
benefit analysis in connection with whether financial and human 
resources should be devoted to providing duplicative capacity.
    Additionally, commenters noted that some key terms were not defined 
in the proposed rule. Several commenters suggested that the Agencies 
should develop the meaning of key terms in the final rule over time and 
through the supervisory process by issuing guidance, supervisory 
letters, or revised regulations. Other commenters specifically 
recommended definitions for certain key terms, including ``credible 
plan,'' ``rapid and orderly resolution,'' and ``material financial 
distress.'' Several commenters requested clarification of the term 
``extraordinary support,'' and suggested that Federal Reserve Bank 
advances, Federal Home Loan Bank advances, and the use of the Deposit 
Insurance Fund not be considered extraordinary support under the 
regulation.

ii. Substantive Credit Exposure Report Requirements

    Several commenters suggested that the provisions requiring credit 
exposure reports be postponed or re-proposed as part of the Board's 
forthcoming proposal to implement the single counterparty credit 
exposure limits established under section 165(e) of the Dodd-Frank Act. 
Other commenters suggested that the credit exposure reporting 
requirement be phased-in over a period of time. Commenters raised a 
variety of questions about the definitions proposed as part of the 
credit exposure report and about the timing, scope, and detail required 
by the proposal.
    Some commenters noted that most of the information contained in the 
credit exposure report requirement is currently reported by insurance 
companies to state insurance commissioners on an annual basis, and 
suggested that the Board and the Corporation rely on these annual 
reports instead of requiring a separate credit exposure report from 
insurance companies.
    One commenter indicated that the final rule should require covered 
companies to be able to report on their supply of liquidity to other 
firms and their dependence on other firms for liquidity, to estimate 
and report on the likely effect of their sales on the prices of major 
classes of assets, and to produce these reports within 24 hours notice, 
whether as part of the credit exposure report or separately.

iii. Foreign Banking Organizations

    With respect to foreign based covered companies, some commenters 
suggested that the applicability of the resolution plan requirement be 
determined by

[[Page 67326]]

reference to U.S. assets of the foreign firm and not with respect to 
the consolidated worldwide assets of the foreign firm. Alternatively, 
these commenters suggested that a foreign banking organization 
(``FBO'') with less than $50 billion in U.S. total consolidated assets 
be subject to reduced or streamlined reporting, and that the rule 
should be tailored to take account of the risk posed by an FBO to U.S. 
financial stability by focusing on the FBO's U.S. structure and 
complexity, the size of its U.S. operations, and the extent of its 
interconnectedness in U.S. financial markets. Commenters requested that 
the submission deadline be extended for FBOs to allow more time for 
these organizations to complete a resolution plan.
    Commenters suggested that the resolution plan requirement be 
aligned with other ongoing cross-border initiatives so as to avoid 
overlapping or inconsistent requirements for internationally active 
firms. Commenters also advocated for international cooperation in 
developing information-sharing arrangements, including coordination 
with or reliance on home-country resolution plans. One comment 
specifically asked for clarification concerning information sharing 
with foreign regulators and recommended consultation with a firm's 
appropriate home-country authority prior to making a credibility 
determination regarding the resolution plan or imposing sanctions 
pursuant to the rule. A commenter suggested that, for those firms with 
an established crisis management group, the resolution plans developed 
through that process be allowed to satisfy the section 165(d) 
resolution plan requirement.
    Commenters asked the Agencies to clarify that any restrictions or 
requirements imposed pursuant to the rule would apply only to an FBO's 
U.S. activities, assets, and operations. In a banking organization with 
multiple covered companies, commenters sought clarification on whether 
the organization could submit one resolution plan or whether each 
covered company within such an organization had to submit a separate 
individualized resolution plan.

iv. Confidentiality

    A frequent comment related to the confidentiality of resolution 
plans and credit exposure reports. Commenters argued that the 
information required to be included in resolution plans represented 
sensitive, confidential business information not otherwise available to 
the public, and the disclosure of which would significantly harm the 
competitiveness of reporting firms. Commenters expressed concern that 
the proposed rule did not provide a sufficient level of assurance that 
resolution plans and credit exposure reports submitted would be kept 
confidential, particularly in light of the disclosure requirements of 
the Freedom of Information Act (``FOIA'').\4\ The commenters suggested 
the proposed rule acknowledge the applicability of certain FOIA 
exemptions. In particular, commenters expressed the view that 
information submitted in connection with the resolution plan and credit 
exposure report requirements should be treated as confidential 
supervisory information. Moreover, commenters suggested that the Board 
and the Corporation put in place procedures (either as part of the 
final rule or in guidance) to minimize the risk of leaks or inadvertent 
disclosures when information contained in the resolution plan and 
credit exposure report was shared among the covered company's 
regulators, including home-country supervisors.
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    \4\ 5 U.S.C. 552(b).
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    The Board and the Corporation have carefully considered the 
comments and made appropriate revisions to the final rule as described 
below.

III. Description of Final Rule

    The final rule applies to any bank holding company that has $50 
billion or more in total consolidated assets, as determined based on 
the average of the company's four most recent Consolidated Financial 
Statements for Bank Holding Companies as reported on the Board's Form 
FR Y-9C. It also applies to any foreign bank or company that is, or is 
treated as, a bank holding company under section 8(a) of the 
International Banking Act of 1978 \5\ and that has $50 billion or more 
in total consolidated assets, as determined based on the average of the 
foreign bank's or company's four most recent quarterly Capital and 
Asset Reports for Foreign Banking Organizations as reported on the 
Board's Form FR Y-7Q (or, if applicable, its most recent annual Form Y-
7Q). A bank holding company that becomes a ``covered company'' remains 
a ``covered company'' unless and until it has less than $45 billion in 
total consolidated assets, as determined based on the most recent 
annual or, as applicable, the average of the four most recent quarterly 
reports made to the Board. A covered company that has reduced its total 
consolidated assets to below $45 billion, as described above, would 
again become a covered company if it has total consolidated assets of 
$50 billion or more at a later date, as determined based on the 
relevant reports. A firm may fall in or out of the definition of a 
``covered company'' because of fluctuations in its asset size. This 
situation necessarily disrupts the continuity of resolution planning 
and increases regulatory uncertainty and burden for many covered 
companies. The $45 billion threshold was added to facilitate continuity 
in resolution planning for covered companies and thereby reduce 
regulatory uncertainty and its associated cost. In a multi-tiered bank 
holding company structure, covered company means the top-tier legal 
entity of the multi-tiered holding company only.
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    \5\ 12 U.S.C. 3106(a).
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    In determining applicability of the final rule to foreign banks, 
the final rule considers a firm's world-wide consolidated assets, 
rather than only its U.S. assets. However, as described in more detail 
below, covered companies (including foreign banks) with relatively 
small nonbanking operations in the U.S. are permitted to file tailored 
reports with reduced information requirements. Given the foregoing, the 
resolution plan of a foreign-based company that has limited assets or 
operations in the United States would be significantly limited in its 
scope and complexity. Moreover, the nature and extent of the home 
country's related crisis management and resolution planning 
requirements for the foreign-based company also will be considered as 
part of the Agencies' resolution plan review process.\6\
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    \6\ The Dodd-Frank Act requires that, in applying the 
requirements of section 165(d) to any foreign nonbank financial 
company supervised by the Board or any foreign-based company, the 
Board give due regard to the principle of national treatment and 
equality of competitive opportunity, and take into account the 
extent to which the foreign-based financial company is subject on a 
consolidated basis to home country standards that are comparable to 
those applied to financial companies in the United States. 12 U.S.C. 
5365(b)(2).
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    In addition, the final rule applies to any nonbank financial 
company that the Council has determined under section 113 of the Dodd-
Frank Act \7\ must be supervised by the Board and for which such 
determination is in effect.
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    \7\ 12 U.S.C. 5323.
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    Under the proposal, a firm would also have been required to submit 
a quarterly report on its credit exposure to other ``significant'' bank 
holding companies and financial firms, as well as their credit exposure 
to the firm. As noted above, commenters expressed significant concerns 
about the clarity of key definitions and the scope of the bi-
directional and intraday reporting

[[Page 67327]]

requirement of the proposal and suggested that the credit exposure 
report requirement be considered in conjunction with the proposal to 
implement the Dodd-Frank Act's single counterparty credit exposure 
limit.
    The Board and the Corporation believe that robust reporting of a 
covered company's credit exposures to other significant bank holding 
companies and financial companies is critical to ongoing risk 
management by covered companies, as well as to the Board's ongoing 
supervision of covered companies and the Corporation's responsibility 
to resolve covered companies, as appropriate. However, the Agencies 
also recognize that these reports would be most useful and complete if 
developed in conjunction with the Dodd-Frank Act's single counterparty 
credit exposure limits. Accordingly, the Board and Corporation are not 
at this time finalizing the credit exposure reporting requirement and 
will coordinate development of these reports with the single 
counterparty credit exposure limits.

Section-by-Section Analysis

    Definitions. Section ----.2 of the final rule defines certain 
terms, including ``rapid and orderly resolution,'' ``material financial 
distress,'' ``core business lines,'' ``critical operations,'' and 
``material entities,'' which are key definitions in the final rule.
    ``Rapid and orderly resolution'' means a reorganization or 
liquidation of the covered company (or, in the case of a covered 
company that is incorporated or organized in a jurisdiction other than 
the United States, the subsidiaries and operations of such foreign 
company that are domiciled in the United States) under the Bankruptcy 
Code that can be accomplished within a reasonable period of time and in 
a manner that substantially mitigates the risk that the failure of the 
covered company would have serious adverse effects on financial 
stability in the United States.\8\ Under the final rule, each 
resolution plan submitted should provide for the rapid and orderly 
resolution of the covered company. The final rule does not specifically 
define or limit this time period in recognition that a reasonable 
period for resolution will depend on the size, complexity, and 
structure of the firm.
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    \8\ If a covered company is subject to an insolvency regime 
other than the Bankruptcy Code, the analysis should be in reference 
to that regime.
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    ``Material financial distress'' with regard to a covered company 
means that: (i) The covered company has incurred, or is likely to 
incur, losses that will deplete all or substantially all of its 
capital, and there is no reasonable prospect for the company to avoid 
such depletion; (ii) the assets of the covered company are, or are 
likely to be, less than its obligations to creditors and others; or 
(iii) the covered company is, or is likely to be, unable to pay its 
obligations (other than those subject to a bona fide dispute) in the 
normal course of business. Under the final rule, each resolution plan 
should provide for the rapid and orderly resolution of the covered 
company in the event of material financial distress or failure of the 
covered company.
    ``Core business lines'' means those business lines, including 
associated operations, services, functions and support that, in the 
firm's view, upon failure would result in a material loss of revenue, 
profit, or franchise value. The resolution plan should address how the 
resolution of the covered company will affect the core business lines.
    ``Critical operations'' are those operations, including associated 
services, functions and support the failure or discontinuance of which, 
in the view of the covered company or as jointly directed by the Board 
and the Corporation, would pose a threat to the financial stability of 
the United States. This definition is revised from the proposal to 
provide greater clarity as to which of a firm's operations would be 
deemed a ``critical operation.'' Initially defined as operations that, 
upon failure or discontinuance, ``would likely result in a disruption 
to the U.S. economy or financial markets,'' the Board and the 
Corporation revised this definition to more closely reflect the purpose 
of section 165 of the Dodd-Frank Act, i.e., ``to prevent or mitigate 
risks to the financial stability of the United States.'' \9\ The 
revised definition clarifies that the threshold of significance for a 
disruption to U.S. financial stability resulting from the failure or 
discontinuance of a critical operation must be severe enough to pose a 
threat to the financial stability of the United States. For example, a 
critical operation of a covered company would include an operation, 
such as a clearing, payment, or settlement system, which plays a role 
in the financial markets for which other firms lack the expertise or 
capacity to provide a ready substitute. The resolution plan should 
address and provide for the continuation and funding of critical 
operations.
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    \9\ See 12 U.S.C. 5365(a)(1).
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    ``Material entity'' means a subsidiary or foreign office of the 
covered company that is significant to the activities of a critical 
operation or core business line.
    Informational content of a resolution plan. Section ----.4 of the 
final rule sets forth the general informational content requirements of 
a resolution plan. A covered company that is domiciled in the United 
States is required to provide information with regard to both its U.S. 
operations and its foreign operations. A foreign-based covered company 
is required to provide information regarding its U.S. operations, an 
explanation of how resolution planning for its U.S. operations is 
integrated into the foreign-based covered company's overall contingency 
planning process, and information regarding the interconnections and 
interdependencies among its U.S. operations and its foreign-based 
operations.
    Under the final rule, a resolution plan is required to contain an 
executive summary, a strategic analysis of the plan's components, a 
description of the covered company's corporate governance structure for 
resolution planning, information regarding the covered company's 
overall organizational structure, information regarding the covered 
company's management information systems, a description of 
interconnections and interdependencies among the covered company and 
its material entities, and supervisory and regulatory information.
    The executive summary must summarize the key elements of the 
covered company's strategic plan, material changes from the most 
recently filed plan, and any actions taken by the covered company to 
improve the effectiveness of the resolution plan or remediate, or 
otherwise mitigate, any material weaknesses or impediments to the 
effective and timely execution of the plan.
    Under the final rule, each resolution plan submitted must also 
describe the firm's strategy for the rapid and orderly resolution of 
the covered company in the event of material financial distress or 
failure of the covered company. This strategic analysis should detail 
how, in practice, the covered company could be resolved under the 
Bankruptcy Code. The strategic analysis should also include the 
analytical support for the plan and its key assumptions, including any 
assumptions made concerning the economic or financial conditions that 
would be present at the time the covered company sought to implement 
such plan.
    The Board and Corporation recognize the burden associated with 
developing an initial resolution plan as well as establishing the 
processes, procedures, and systems necessary to annually, or as 
otherwise appropriate, update a resolution plan. While an 
organization's

[[Page 67328]]

initial resolution plan must include all informational elements 
required under this final rule, the Board and Corporation (as noted 
above) expect the process of submission and review of the initial 
resolution plan iterations to include an ongoing dialogue with firms. 
In developing their initial resolution plans, covered companies should 
therefore focus on the key elements of a resolution plan, including 
identifying critical and core operations, developing a robust strategic 
analysis, and identifying and describing the interconnections and 
interdependencies among material entities. To the extent practicable, 
covered companies should--with respect to the initial resolution plan--
try to leverage off of and incorporate information already reported to 
the Board or Corporation or already publicly-disclosed, e.g., in 
securities or other similar filings.
    The final rule specifies the minimum content of a resolution plan. 
The Board and the Corporation recognize that plans will vary by company 
and, in their evaluation of plans, will take into account variances 
among companies in their core business lines, critical operations, 
foreign operations, capital structure, risk, complexity, financial 
activities (including the financial activities of their subsidiaries), 
size, and other relevant factors. The resolution plans of more complex 
covered companies will be more complex and require information that may 
not be relevant for smaller, less complex covered companies. For 
example, a less complex covered company that does not engage in a 
material number or value amount of trades will not be required to 
address that component of the resolution plan, while a more complex 
covered company may require an extensive discussion of systems in which 
it conducts trading operations and how those systems map to material 
entities, critical operations and core business lines. To the extent an 
informational element is not applicable or the covered company does not 
engage in the activity relevant to such informational element to a 
material extent, then a covered company should indicate such in its 
resolution plan and is not required to provide other information with 
regard to that informational element.
    Several commenters requested clarification of a provision in the 
proposal that required that the firm's resolution plan not rely on the 
provision of extraordinary support of the United States or any other 
government to the covered company or its subsidiaries to prevent the 
failure of the covered company. The provision is intended to prohibit 
the covered company from assuming in its resolution plan that the 
United States or any other government will provide the covered company 
funding or capital other than in the ordinary course of business.
    A resolution plan must be sensitive to the economic conditions at 
the time the plan is triggered. To assist in establishing the 
assumptions for the economic conditions triggering a resolution plan, 
the Agencies propose referencing conditions developed pursuant to 
Section 165(i)(1) of the Dodd-Frank Act.\10\ Under that section, the 
Board, in coordination with the appropriate primary financial 
regulatory agencies and the Federal Insurance Office, will conduct 
annual stress tests of covered companies. As part of that exercise, the 
Board expects to provide covered companies with different sets of 
economic conditions under which the evaluation will be conducted: 
Baseline, adverse, and severely adverse economic conditions. For its 
initial resolution plan, a covered company may assume that failure 
would occur under the baseline economic scenario, or, if a baseline 
scenario is not then available, a reasonable substitute developed by 
the covered company. Subsequent iterations of a covered company's 
resolution plan should assume that the failure of the covered company 
will occur under the same economic conditions consistent with the 
Board's final rule implementing Section 165(i)(1).
---------------------------------------------------------------------------

    \10\ 12 U.S.C. 5365(i).
---------------------------------------------------------------------------

    The strategic analysis should include detailed information as to 
how, in the event of material financial distress or failure of the 
covered company, a reorganization or liquidation of the covered company 
(or, in the case of a covered company that is incorporated or organized 
in a jurisdiction other than the United States, the subsidiaries and 
operations of such foreign company that are domiciled in the United 
States) under the Bankruptcy Code could be accomplished within a 
reasonable period of time and in a manner that substantially mitigates 
the risk that the failure of the covered company would have serious 
adverse effects on financial stability in the United States. The 
strategic analysis of the covered company's resolution plan must also 
identify the range of options and specific actions to be taken by the 
covered company to facilitate a rapid and orderly resolution of the 
covered company, its material entities, critical operations, and core 
business lines in the event of its material financial distress or 
failure.
    Funding, liquidity, support functions, and other resources, 
including capital resources, should be identified and mapped to the 
covered company's material entities, critical operations, and core 
business lines. The covered company's strategy for maintaining and 
funding the material entities, critical operations, and core business 
lines in an environment of material financial distress and in the 
implementation and execution of its resolution plan should be provided 
and mapped to its material entities. The covered company's strategic 
analysis should demonstrate how such resources would be utilized to 
facilitate an orderly resolution in an environment of material 
financial distress. The covered company should also provide its 
strategy in the event of a failure or discontinuation of a material 
entity, critical operation, or core business line and the actions that 
will be taken by the covered company to prevent or mitigate any adverse 
effects of such failure or discontinuation on the financial stability 
of the company and the United States.
    The final rule designates a subsidiary that conducts core business 
lines or critical operations of the covered company as a ``material 
entity.'' When the covered company utilizes a material entity and that 
material entity is subject to the Bankruptcy Code, then a resolution 
plan should assume the failure or discontinuation of such material 
entity and provide both the covered company's and the material entity's 
strategy, and the actions that will be taken by the covered company to 
prevent or mitigate any adverse effects of such failure or 
discontinuation on the financial stability of the United States.
    A number of commenters asked how this discussion of strategy was to 
be applied when a major subsidiary was not subject to the Bankruptcy 
Code, but rather to another specialized insolvency regime, such as the 
FDI Act, state liquidation regimes for state-licensed uninsured 
branches and agencies of foreign banks, the International Banking Act 
of 1978 for federally licensed branches and agencies, foreign 
insolvency regimes, state insolvency regimes for insurance companies, 
or the Securities Investor Protection Act applicable to broker-dealers. 
Recognizing many of the challenges that may be posed by such a 
requirement if a material entity is subject to an insolvency regime 
other than the Bankruptcy Code, the final rule provides that a covered 
company may limit its strategic analysis with respect to a material 
entity that is subject to an insolvency regime other than the

[[Page 67329]]

Bankruptcy Code to a material entity that either has $50 billion or 
more in total assets or conducts a critical operation. Any such 
analysis should be in reference to that applicable regime. Thus, for 
example, if a covered company owns a national bank with $50 billion or 
more in total consolidated assets, the resolution plan of the covered 
company should assume the resolution of the bank under the FDI Act and 
the actions that will be taken by the covered company to prevent or 
mitigate any adverse effects of such failure or discontinuation on the 
financial stability of the United States.
    Under a separate rulemaking, the Corporation is requiring insured 
depository institutions with total assets of $50 billion or more to 
develop their own strategies to facilitate a resolution under the FDI 
Act.\11\ The Corporation's rulemaking is intended to complement the 
final rule and, together with the final rule, provide for comprehensive 
and coordinated resolution planning for both the insured depository 
institution and its parent holding company and affiliates in the event 
that an orderly liquidation is required.
---------------------------------------------------------------------------

    \11\ See Special Reporting, Analysis and Contingent Resolution 
Plans at Certain Large Insured Depository Institutions, 75 FR 27,464 
(May 17, 2010) (to be codified at 12 CFR part 360). On September 13, 
2011, the Corporation approved an interim final rule to implement 
this requirement. The Corporation's rule is available at: http://fdic.gov/news/news/press/2011/pr11150.html.
---------------------------------------------------------------------------

    The resolution plan must also describe the covered company's 
strategy for ensuring that its insured depository institution 
subsidiary will be adequately protected from risks arising from the 
activities of any nonbank subsidiaries of the covered company (other 
than those that are subsidiaries of an insured depository institution). 
This requirement is a specific statutory requirement and is applicable 
only to insured depository institutions and is not applicable to other 
types of regulated subsidiaries.\12\
---------------------------------------------------------------------------

    \12\ 12 U.S.C. 5365(d)(1)(A).
---------------------------------------------------------------------------

    Under the final rule, the description of the covered company's 
corporate governance structure for resolution planning should include 
information regarding how resolution planning is integrated into the 
corporate governance structure and processes of the covered company. It 
must also identify the senior management official who is primarily 
responsible for overseeing the development, maintenance, 
implementation, and filing of the resolution plan and for the covered 
company's compliance with the final rule. The requirements in the final 
rule are minimums and the corporate governance structure is expected to 
vary based upon the size and complexity of the covered company. For the 
largest and most complex companies, it may be necessary to establish a 
central planning function that is headed by a senior management 
official. Such official could report to the Chief Risk Officer or Chief 
Executive Officer and periodically report on resolution planning to the 
covered company's board of directors.
    The information regarding the covered company's overall 
organizational structure and related information should include a 
hierarchical list of all material entities, with jurisdictional and 
ownership information. This information should be mapped to core 
business lines and critical operations. The proposal would have 
required each covered company to provide its unconsolidated balance 
sheet and a consolidating schedule for all entities that are subject to 
consolidation by the covered company. However, in response to 
commenters' concerns, the Board and Corporation revised the final rule 
to require only an unconsolidated balance sheet for the covered 
company, together with a consolidating schedule for all material 
entities that are subject to consolidation. Amounts attributed to 
entities that are not material entities may be aggregated on the 
consolidating schedule.
    Under the final rule, the resolution plan should include 
information regarding material assets, liabilities, derivatives, 
hedges, capital and funding sources, and major counterparties. Material 
assets and liabilities should be mapped to material entities along with 
location information. An analysis of whether the bankruptcy of a major 
counterparty would likely have an adverse effect on and result in the 
material financial distress or failure of the covered company should 
also be included. Trading, payment, clearing, and settlement systems 
utilized by the covered company should be identified. The covered 
company would not need to identify trading, payment, clearing, and 
settlement systems that are immaterial in resolution planning, such as 
a local check clearing house.
    For a U.S.-based covered company with foreign operations, the plan 
should identify the extent of the risks to the U.S. operations of the 
firm related to its foreign operations and the covered company's 
strategy for addressing such risks. These elements of the resolution 
plan should take into consideration the complications created by 
differing national laws, regulations, and policies. This analysis 
should include a mapping of core business lines and critical operations 
to legal entities operating in or with assets, liabilities, operations, 
or service providers in foreign jurisdictions. The continued ability to 
maintain core business lines and critical operations in these foreign 
jurisdictions during material financial distress and insolvency 
proceedings should be evaluated and steps identified to address 
weaknesses or vulnerabilities.
    The final rule requires the covered company to provide information 
regarding the management information systems supporting its core 
business lines and critical operations, including information regarding 
the legal ownership of such systems as well as associated software, 
licenses, or other associated intellectual property. The analysis and 
practical steps that are identified by the covered company should 
address the continued availability of the key management information 
systems that support core business lines and critical operations both 
within the United States and in foreign jurisdictions.
    The final rule requires the resolution plan to include a 
description of the capabilities of the covered company's management 
information systems to collect, maintain, and report, in a timely 
manner to management of the covered company and to the Board, the 
information and other data underlying the resolution plan. Moreover, 
the resolution plan must also identify the deficiencies, gaps, or 
weaknesses in those capabilities of the covered company's management 
information systems and describe the actions the covered company plans 
to undertake, including the associated timelines for implementation, to 
promptly address such deficiencies, gaps, or weaknesses. The Board will 
use its examination authority to review the demonstrated capabilities 
of each covered company to satisfy these requirements, and will share 
with the Corporation information regarding the capabilities of the 
covered company to collect, maintain, and report in a timely manner 
information and data underlying the resolution plan.
    The final rule also requires the covered company to provide a 
description of the interconnections and interdependencies among the 
covered company and its material entities and affiliates, and among the 
critical operations and core business lines of the covered company 
that, if disrupted, would materially affect the funding or operations 
of the covered company, its material entities, its critical operations, 
or core business lines. As noted above, the continued availability of 
key services and supporting business operations to core business lines 
and critical operations in an environment of

[[Page 67330]]

material financial distress and after insolvency should be a focus of 
resolution planning. Steps to ensure that service level agreements for 
such services, whether provided by internal or external service 
providers, survive insolvency should be demonstrated in the resolution 
plan.
    The plan should identify the covered company's supervisory 
authorities and regulators, including information identifying any 
foreign agency or authority with significant supervisory authority over 
material foreign-based subsidiaries or operations.
    Section 165(d) applies to a number of companies that operate 
predominately through one or more insured depository institutions. As 
discussed above, several commenters argued that the rule should make 
allowances for the significant differences in complexity and structure 
among the various bank holding companies subject to the rule. 
Commenters recommended that the Board and Corporation modify the final 
rule to provide for a tailored resolution plan regime for smaller, less 
complex bank holding companies and foreign banking organizations.
    In response to these comments, the Board and Corporation have 
tailored the resolution plan requirement applicable to smaller, less 
complex bank holding companies and foreign banking organizations in 
order to focus the content and analysis of such an organization's 
resolution plan on the nonbanking operations of the organization, and 
the interconnections between the nonbanking operations and the insured 
depository institution operations of the covered company.
    For covered companies with less than $100 billion in total nonbank 
assets that predominately operate through one or more insured 
depository institutions, i.e., the company's insured depository 
institution subsidiaries comprise at least 85 percent of its total 
consolidated assets (or, in the case of a foreign-based covered 
company, the assets of the U.S. depository institution operations, 
branches, and agencies of which comprise 85 percent or more of the 
company's U.S. total consolidated assets), the Board and Corporation 
have tailored the resolution plan requirements to focus on the nonbank 
operations of the covered company. Specifically, a firm meeting the 
above criteria, and not otherwise excluded or directed by the Board and 
Corporation to submit a standard resolution plan, shall in its 
resolution plan identify and describe interconnections and 
interdependencies pursuant to Sec.  [--].4(g) and provide the contact 
information required under Sec.  [--].4(i) with respect to the entire 
organization. Such resolution plan must also include the remaining 
resolution plan elements, i.e., the strategic analysis, organizational 
structure, description of management information systems, and the other 
content specified in Sec.  [--].4(c) through Sec.  [--].4(f) and Sec.  
[--].4(h), only with respect to the covered company's nonbanking 
operations. Importantly, with respect to the information concerning 
interconnections and interdependencies, the resolution plan must 
describe in detail, and map to legal entity the interconnections and 
interdependencies among the nonbanking operations as well as between 
the nonbanking operations and the insured depository institution 
operations of the covered company.
    Covered companies with more than $100 billion in nonbank assets are 
not eligible to submit the type of plan described above, regardless of 
whether their operations satisfy the 85 percent criterion described 
above. Under the final rule, the Board and Corporation may determine 
that a firm that would otherwise meet the prerequisites for submitting 
a tailored plan must nonetheless submit the full resolution plan.
    Resolution plans required. Section ----.3 of the proposed rule 
required each covered company to submit a resolution plan within 180 
days of the effective date of the final rule, or within 180 days of 
such later date as the company becomes a covered company. Several 
commenters suggested that, given the limited resources of the Board and 
the Corporation to review resolution plans and the industry's desire 
for additional time to prepare resolution plans, the timing for 
submission of plans should be staggered.
    Under the final rule, firms will be required to file resolution 
plans in three groups with a staggered schedule. The first group 
comprises the largest, most complex covered companies, i.e., any 
covered company that has $250 billion or more in total nonbank assets 
(or, in the case of a foreign-based covered company, $250 billion or 
more in total U.S. nonbank assets). Covered companies in this first 
group must submit their initial resolution plans no later than July 1, 
2012.
    Firms in the second group of covered companies must submit their 
initial resolution plans no later than July 1, 2013. This second group 
consists of covered companies with $100 billion or more in nonbank 
assets (or, in the case of a foreign-based covered company, $100 
billion or more in total U.S. nonbank assets).
    The third and final group consists of the remaining covered 
companies, i.e., covered companies with less than $100 billion in 
nonbank assets (or, in the case of a foreign-based covered company, in 
total U.S. nonbank assets). Covered companies in this third group are 
required to file their initial resolution plans on or before December 
31, 2013. The above phase-in schedule generally applies to any company 
that is a covered company as of the effective date.
    A company that becomes a covered company after the effective date 
of this final rule, e.g., a company the Council has designated for 
supervision by the Board or a bank holding company that grows, 
organically or by merger or acquisition, over the $50 billion 
threshold, must submit its resolution plan by the next July 1 following 
the date the company becomes a covered company, provided such date is 
at least 270 days after the date the company becomes a covered company. 
The final rule permits the Board and Corporation to jointly determine 
that a covered company must submit its initial resolution plan earlier 
or later than provided for in the final rule.
    The Agencies have also revised the requirements for updating the 
resolution plan. After the initial resolution plan is submitted, each 
covered company is required to submit an updated resolution plan 
annually on or before the anniversary date of the date for submission 
of its initial plan.
    This annual filing provides a regular opportunity for firms to 
update their resolution plans to reflect structural changes, 
acquisitions, and sales. Moreover, the Agencies expect that firms will 
integrate resolution planning into their business operations. 
Accordingly, the final rule no longer requires that a resolution plan 
be updated automatically upon the occurrence of a restructuring, 
acquisition, or sale. Instead, the final rule requires that a firm 
update its next annual resolution plan after the occurrence of a 
material event, such as a restructuring, acquisition, or sale. The 
final rule also requires the firm to file a simple notice with the 
Board and the Corporation that such an event has occurred. That notice 
must be provided within a time period specified by the Board and the 
Corporation, but no later than 45 days after any event, occurrence, 
change in conditions or circumstances or other change that results in, 
or could reasonably be foreseen to have, a material effect on the 
resolution plan of the covered company. The final rule requires such 
notice to summarize why the event, occurrence,

[[Page 67331]]

or change may require changes to the resolution plan.
    The Board and the Corporation jointly may waive a requirement that 
a covered company file a notice following a material event. The Board 
and the Corporation jointly may also require an update for any other 
reason, more frequent submissions or updates, and may extend the time 
period that a covered company has to submit its resolution plan or 
notice following a material event.
    Like the proposal, the final rule requires that a covered company 
provide the Board and the Corporation information and access to its 
personnel necessary for the Board and Corporation to assess the 
resolution plan during the period for reviewing the resolution plan as 
provided for under the final rule. The Board and the Corporation must 
rely to the fullest extent possible on examinations conducted by or on 
behalf of the appropriate Federal banking agency for the relevant 
company.
    The involvement of a firm's board of directors is critical to 
adequate resolution planning. Under both the proposed and final rules, 
the board of directors of the covered company is required to approve 
the initial resolution plans and each annual resolution plan. In the 
case of a foreign-based covered company, a delegee of the board of the 
directors of such organization may approve the initial resolution plan 
and any updates to a resolution plan. For a U.S. domiciled company, the 
board of directors must approve the resolution plan in accordance with 
the procedures applicable to other documents of strategic importance. 
The rule does not require the board of directors to make an attestation 
regarding the resolution plan.
    Review of resolution plans; resubmission of deficient resolutions 
plans. Several commenters requested changes in the process and 
procedures for reviewing resolution plans set forth in the proposed 
rule. The Board and the Corporation will work closely with covered 
companies and, as applicable, other authorities, in the development of 
a firm's resolution plan and are dedicating staff for that purpose. The 
Board and the Corporation expect the review process to evolve as 
covered companies gain more experience in preparing their resolution 
plans. The Board and the Corporation recognize that resolution plans 
will vary by company and, in their evaluation of plans, will take into 
account variances among companies in their core business lines, 
critical operations, domestic and foreign operations, capital 
structure, risk, complexity, financial activities (including the 
financial activities of their subsidiaries), size, and other relevant 
factors. Because each resolution plan is expected to be unique, the 
Board and the Corporation encourage covered companies to ask questions 
and, if so desired, to arrange a meeting with the Board and the 
Corporation. There is no expectation by the Board and the Corporation 
that the initial resolution plan iterations submitted after this rule 
takes effect will be found to be deficient, but rather the initial 
resolution plans will provide the foundation for developing more robust 
annual resolution plans over the next few years following that initial 
period.
    Section ----.5 of the final rule sets forth procedures regarding 
the review of resolution plans. When a covered company submits a 
resolution plan, the Board and Corporation will preliminarily review a 
resolution plan for informational completeness within 60 days. If the 
Board and the Corporation determine that a resolution plan is 
informationally incomplete or that substantial additional information 
is necessary to facilitate further review, the Board and the 
Corporation will inform the covered company in writing of the area(s) 
in which the resolution plan is informationally incomplete or with 
respect to which additional information is required. The covered 
company will be required to resubmit an informationally complete 
resolution plan, or such additional information as jointly requested to 
facilitate review of the resolution plan, no later than 30 days after 
receiving such notice or such other time period as the Board and 
Corporation may jointly determine.
    The Board and Corporation will review each resolution plan for its 
compliance with the requirements of the final rule. If, following such 
review, the Board and the Corporation jointly determine that the 
resolution plan of a covered company submitted under this part is not 
credible or would not facilitate an orderly resolution of the covered 
company under the Bankruptcy Code, the Board and Corporation will 
jointly notify the covered company in writing of such determination. 
Such notice will identify the aspects of the resolution plan that the 
Board and Corporation jointly determined to be deficient and request 
the resubmission of a resolution plan that remedies the deficiencies of 
the resolution plan.
    Within 90 days of receiving such notice of deficiencies, or such 
shorter or longer period as the Board and Corporation may jointly 
determine, a covered company will be required to submit a revised 
resolution plan to the Board and Corporation that addresses the 
deficiencies jointly identified by the Board and Corporation. The 
revised resolution plan will be required to discuss in detail: (i) The 
revisions made by the covered company to address the deficiencies 
jointly identified by the Board and the Corporation; (ii) any changes 
to the covered company's business operations and corporate structure 
that the covered company proposes to undertake to facilitate 
implementation of the revised resolution plan (including a timeline for 
the execution of such planned changes); and (iii) why the covered 
company believes that the revised resolution plan is credible and would 
result in an orderly resolution of the covered company under the 
Bankruptcy Code.
    Upon their own initiative or a written request by a covered 
company, the Board and Corporation may jointly extend any time for 
review and submission established hereunder. Any extension request 
should be supported by a written statement of the company describing 
the basis and justification for the request.
    Failure to cure deficiencies on resubmission of a resolution plan. 
Section ----.6 of the final rule provides that, if the covered company 
fails to submit a revised resolution plan or the Board and the 
Corporation jointly determine that a revised resolution plan submitted 
does not adequately remedy the deficiencies identified by the Board and 
the Corporation, then the Board and Corporation may jointly subject a 
covered company or any subsidiary of a covered company to more 
stringent capital, leverage, or liquidity requirements or restrictions 
on growth, activities, or operations. Any such requirements or 
restrictions would apply to the covered company or subsidiary, 
respectively, until the Board and the Corporation jointly determine the 
covered company has submitted a revised resolution plan that adequately 
remedies the deficiencies identified. In addition, if the covered 
company fails, within the two-year period beginning on the date on 
which the determination to impose such requirements or restrictions was 
made, to submit a revised resolution plan that adequately remedies the 
deficiencies jointly identified by the Board and the Corporation, then 
the Board and Corporation, in consultation with the Council, may 
jointly, by order, direct the covered company to divest such assets or 
operations as the Board and Corporation jointly determine necessary to 
facilitate an orderly resolution of the covered company under the 
Bankruptcy Code in the event the company were to fail.

[[Page 67332]]

    Consultation. Section ----.7 of the final rule provides that, prior 
to issuing any notice of deficiencies, determining to impose 
requirements or restrictions on a covered company, or issuing a 
divestiture order with respect to a covered company that is likely to 
have a significant effect on a functionally regulated subsidiary or a 
depository institution subsidiary of the covered company, the Board 
shall consult with each Council member that primarily supervises any 
such subsidiary and may consult with any other federal, state, or 
foreign supervisor as the Board considers appropriate.
    No limiting effect or private right of action; confidentiality of 
resolution plans. Section ----.8 of the final rule provides that a 
resolution plan submitted shall not have any binding effect on: (i) A 
court or trustee in a proceeding commenced under the Bankruptcy Code; 
(ii) a receiver appointed under Title II of the Dodd-Frank Act (12 
U.S.C. 5381 et seq.); (iii) a bridge financial company chartered 
pursuant to 12 U.S.C. 5390(h); or (iv) any other authority that is 
authorized or required to resolve a covered company (including any 
subsidiary or affiliate thereof) under any other provision of federal, 
state, or foreign law.
    The final rule further provides that nothing in the rule would 
create or is intended to create a private right of action based on a 
resolution plan prepared or submitted under this part or based on any 
action taken by the Board or the Corporation with respect to any 
resolution plan submitted under this part.
    Most commenters requested that the resolution plans be treated as 
exempt from disclosure under FOIA. The Board and the Corporation are 
aware of and sensitive to the significant concerns regarding 
confidentiality of resolution plans. The regulation contemplates and 
requires the submission of highly detailed, internal proprietary 
information of covered companies. This is the type of information that 
covered companies would not customarily make available to the public 
and that an agency typically would have access to and could review as 
part of the supervisory process in assessing, for example, the safety 
and soundness of a regulated institution. Moreover, release of this 
information would impede the quality and extent of information provided 
by covered companies and could significantly impact the efforts of the 
Board and the Corporation to encourage effective and orderly unwinding 
of the covered companies in a crisis.
    Under section 112(d)(5)(A) of the Dodd-Frank Act, the Board and the 
Corporation ``shall maintain the confidentiality of any data, 
information, and reports submitted under'' Title I (which includes 
section 165(d), the authority this regulation is promulgated under) of 
the Dodd-Frank Act. The Board and the Corporation will assess the 
confidentiality of resolution plans and related material in accordance 
with applicable exemptions under FOIA and the Board's and the 
Corporation's implementing regulations (12 CFR part 261 (Board); 12 CFR 
part 309 (Corporation)). The Board and the Corporation certainly expect 
that large portions of the submissions will contain or consist of 
``trade secrets and commercial or financial information obtained from a 
person and privileged or confidential'' and information that is 
``contained in or related to examination, operating, or condition 
reports prepared by, on behalf of, or for the use of an agency 
responsible for the regulation or supervision of financial 
institutions.'' This information is subject to withholding under 
exemptions 4 and 8 of the FOIA, 5 U.S.C. 552(b)(4) and 552(b)(8).
    The Board and the Corporation also recognize, however, that the 
regulation calls for the submission of details regarding covered 
companies that are publicly available or otherwise are not sensitive 
and should be made public.
    In order to address this, the regulation requires resolution plans 
to be divided into two portions: a public section and a confidential 
section. The public section of the resolution plan should consist of an 
executive summary of the resolution plan that describes the business of 
the covered company and includes, to the extent material to an 
understanding of the covered company: (i) The names of material 
entities; (ii) a description of core business lines; (iii) consolidated 
or segment financial information regarding assets, liabilities, capital 
and major funding sources; (iv) a description of derivative activities 
and hedging activities; (v) a list of memberships in material payment, 
clearing, and settlement systems; (vi) a description of foreign 
operations; (vii) the identities of material supervisory authorities; 
(viii) the identities of the principal officers; (ix) a description of 
the corporate governance structure and processes related to resolution 
planning; (x) a description of material management information systems; 
and (xi) a description, at a high level, of the covered company's 
resolution strategy, covering such items as the range of potential 
purchasers of the covered company, its material entities and core 
business lines. While the information in the public section of a 
resolution plan should be sufficiently detailed to allow the public to 
understand the business of the covered company, such information can be 
high level in nature and based on publicly available information.
    The public section will be made available to the public in 
accordance with the Board's Rules Regarding Availability of Information 
(12 CFR part 261) and the Corporation's Disclosure of Information Rules 
(12 CFR part 309).
    A covered company should submit a properly substantiated request 
for confidential treatment of any details in the confidential section 
that it believes are subject to withholding under exemption 4 of the 
FOIA. In addition, the Board and the Corporation will make formal 
exemption and segregability determinations if and when a plan is 
requested under the FOIA.
    Enforcement. Section ----.9 of the final rule provides that the 
Board and Corporation may jointly enforce an order jointly issued under 
section ----.6(a) or ----.6(c) of the final rule. Furthermore, the 
Board, in consultation with the Corporation, may address any violation 
of the rule by a covered company under section 8 of the Federal Deposit 
Insurance Act (12 U.S.C. 1818).

V. Administrative Law Matters

A. Paperwork Reduction Act Analysis

    In accordance with the requirements of the Paperwork Reduction Act 
of 1995 (44 U.S.C. 3501 et seq.), the Board may not conduct or sponsor, 
and the respondent is not required to respond to, an information 
collection unless it displays a currently valid Office of Management 
and Budget (``OMB'') control number. The Board reviewed the final rule 
under the authority delegated to the Board by OMB. The OMB control 
number for these information collections will be assigned.
    Two commenters expressed concern about the Paperwork Reduction Act 
analysis published as part of the proposed rule, and noted that the 
Board and Corporation omitted nonbank financial companies designated by 
the Council for enhanced supervision by the Board from that analysis. 
While the final rule applies to any nonbank financial company 
supervised by the Board, no such covered company exists because the 
Council has, to date, not designated any such company for enhanced 
supervision by the Board. However, the Board expects that the amount of 
burden the final rule would impose on a nonbank financial company 
designated by the Council to be similar

[[Page 67333]]

to the amount of burden estimated for other covered companies.
    One commenter stated that the cost-benefit analysis of the proposed 
rule significantly underestimated the time, effort, and expense 
associated with compliance. The Board notes that several of the changes 
described in the Supplementary Information reduce the burden associated 
with the final rule, particularly for smaller, less complex covered 
companies. Specifically, the final rule streamlines the resolution plan 
requirement applicable to covered companies that operate predominately 
through one or more insured depository institutions (or, in the case of 
foreign banking organizations subject to the rule, U.S. insured 
depository institutions, branches, and agencies). The information 
required under a tailored plan is generally limited to information 
regarding the nonbanking operations of the company and the 
interconnections between the bank and nonbank operations of the 
company, rather than its entire operations.
    Title of Information Collection: Resolution Plans Required.
    Frequency of Response: Varied--annually, semiannually, and event-
generated.
    Affected Public: The final rule applies to bank holding companies 
and foreign banking organizations with total consolidated assets of $50 
billion or more, and nonbank financial companies designated by the 
Council for enhanced supervision by the Board.
    Abstract: The information collection requirements of the final rule 
are found in sections [--].3, [--].4, and [--].5 of the final rule. 
Specifically, as explained in the Supplemental Information, section [--
].3 sets forth a staggered schedule for submission of initial 
resolution plans by covered companies, and requires covered companies 
to annually submit an updated resolution plan on the anniversary of the 
initial submission date. Section [--].3 of the final rule establishes a 
requirement that a covered company provide notice to the Board and 
Corporation of material events that have the potential to impact its 
resolution plan.
    Section [--].4 of the final rule describes the required 
informational content of both a full resolution plan and the tailored 
resolution plan available to smaller, less complex covered companies. 
In providing organizational structure information required in section 
[--].4, a covered company may rely on the information it previously 
reported to the Board (FR Y-6, Annual Report of Bank Holding Companies; 
FR Y-7, Annual Report of Foreign Banking Organizations; and FR Y-10, 
Report of Changes in Organizational Structure; OMB No. 7100-0297).
    Under section [--].5 of the final rule, a covered company is 
required to resubmit an informationally complete resolution plan or 
additional information as jointly requested by the Board and 
Corporation to facilitative review of the covered company's resolution 
plan within 30 days of receiving notice that its resolution plan is 
deemed incomplete. Section [--].5 of the final rule also requires that, 
if the Board and Corporation jointly determine that a resolution plan 
of a covered company is not credible, a covered company must resubmit a 
revised plan within 90 days of receiving notice that its resolution 
plan is deemed deficient. A covered company may also submit a written 
request for an extension of time to resubmit additional information or 
a revised resolution plan. As noted in the Supplemental Information, 
the Board and the Corporation will, in a manner consistent with the 
Dodd-Frank Act, assess the confidentiality of resolution plans and 
related material in accordance with applicable exemptions under FOIA 
and the Board's and the Corporation's implementing regulations (12 CFR 
part 261 (Board); 12 CFR part 309 (Corporation)).
    These requirements would implement the resolution plan requirement 
set forth in section 165(d)(1) of the Dodd-Frank Act. Since the Board 
supervises all of the respondents, the Board will take the entire 
paperwork burden associated with this information collection.
Estimated Burden
    The burden associated with this collection of information may be 
summarized as follows:
    Number of Respondents: Resolution Plan (Tailored Reporters): 104; 
Resolution Plan (Full Reporters): 20; Notice of Material Change: 3; 
Additional Information and Extension Requests: 24.
    Estimated Average Hours per Response (Initial Implementation): 
Resolution Plan (Tailored Reporters): 4,500 hours; Resolution Plan 
(Full Reporters): 9,200 hours; Additional Information Requests: 1,000 
hours.
    Estimated Average Hours per Response (Ongoing): Resolution Plan 
(Tailored Reporters): 1,000 hours; Resolution Plan (Full Reporters): 
2,561 hours; Notice of Material Change: 20 hours; Extension Requests: 1 
hour.
    Total Estimated Annual Burden: 700,000 hours for initial 
implementation and 155,304 hours on an ongoing basis.
    The Agencies have a continuing interest in the public's opinions of 
collections of information. At any time, comments regarding the burden 
estimate, or any other aspect of this collection of information, 
including suggestions for reducing the burden, may be sent to: 
Secretary, Board of Governors of the Federal Reserve System, 20th and C 
Streets, NW., Washington, DC 20551; and to the Office of Management and 
Budget, Paperwork Reduction Project (7100-NEW), Washington, DC 20503.

B. Regulatory Flexibility Act Analysis

    The Regulatory Flexibility Act, 5 U.S.C. 601 et seq. (``RFA''), 
requires each Federal agency to prepare a final regulatory flexibility 
analysis in connection with the promulgation of a final rule, or 
certify that the final rule will not have a significant economic impact 
on a substantial number of small entities.\13\ Based on the analysis 
and for the reasons stated below, the Corporation certifies that this 
final rule will not have a significant economic impact on a substantial 
number of small entities. The Board believes that the final rule will 
not have a significant economic impact on a substantial number of small 
entities, but nonetheless is conducting the Regulatory Flexibility Act 
Analysis for this final rule.
---------------------------------------------------------------------------

    \13\ See 5 U.S.C. 603, 604 and 605.
---------------------------------------------------------------------------

    In accordance with section 165(d) of the Dodd-Frank Act, the Board 
is adopting the final rule as Regulation QQ and is proposing to add new 
Part 243 (12 CFR part 243) and the Corporation is proposing to add new 
Part 381 (12 CFR part 381) to establish the requirements that a covered 
company periodically submit a resolution plan to the Board and 
Corporation.\14\ The final rule would also establish the procedures 
joint review of a resolution plan by the Board and Corporation. The 
reasons and justification for the final rule are described in the 
Supplementary Information. As further discussed in the Supplementary 
Information, the procedure, standards, and definitions that would be 
established by the final rule are relevant to the joint authority of 
the Board and Corporation to implement the resolution plan.
---------------------------------------------------------------------------

    \14\ See 12 U.S.C. 5365(d).
---------------------------------------------------------------------------

    Under regulations issued by the Small Business Administration 
(``SBA''), a ``small entity'' includes those firms within the ``Finance 
and Insurance'' sector with asset sizes that vary from $7 million or 
less in assets to $175 million

[[Page 67334]]

or less in assets.\15\ The Board believes that the Finance and 
Insurance sector constitutes a reasonable universe of firms for these 
purposes because such firms generally engage in actives that are 
financial in nature. Consequently, bank holding companies or nonbank 
financial companies with assets sizes of $175 million or less are small 
entities for purposes of the RFA.
---------------------------------------------------------------------------

    \15\ 13 CFR 121.201.
---------------------------------------------------------------------------

    As discussed in the Supplementary Information, the final rule 
applies to a ``covered company,'' which includes only bank holding 
companies and foreign banks that are or are treated as a bank holding 
company (``foreign banking organization'') with $50 billion or more in 
total consolidated assets, and nonbank financial companies that the 
Council has determined under section 113 of the Dodd-Frank Act must be 
supervised by the Board and for which such determination is in effect. 
Bank holding companies and foreign banking organizations that are 
subject to the final rule therefore substantially exceed the $175 
million asset threshold at which a banking entity is considered a 
``small entity'' under SBA regulations.\16\ The final rule would apply 
to a nonbank financial company supervised by the Board regardless of 
such a company's asset size. Although the asset size of nonbank 
financial companies may not be the determinative factor of whether such 
companies may pose systemic risks and would be designated by the 
Council for supervision by the Board, it is an important 
consideration.\17\ It is therefore unlikely that a financial firm that 
is at or below the $175 million asset threshold would be designated by 
the Council under section 113 of the Dodd-Frank Act because material 
financial distress at such firms, or the nature, scope, size, scale, 
concentration, interconnectedness, or mix of it activities, are not 
likely to pose a threat to the financial stability of the United 
States.
---------------------------------------------------------------------------

    \16\ The Dodd-Frank Act provides that the Board may, on the 
recommendation of the Council, increase the $50 billion asset 
threshold for the application of the resolution plan and credit 
exposure report requirements. See 12 U.S.C. 5365(a)(2)(B). However, 
neither the Board nor the Council has the authority to lower such 
threshold.
    \17\ See 76 FR 4555 (January 26, 2011).
---------------------------------------------------------------------------

    As noted above, because the final rule is not likely to apply to 
any company with assets of $175 million or less, the final rule is not 
expected to apply to any small entity for purposes of the RFA. 
Moreover, as discussed in the Supplementary Information, the Dodd-Frank 
Act requires the Board and the Corporation jointly to adopt rules 
implementing the provisions of section 165(d) of the Dodd-Frank Act. 
The Board does not believe that the final rule would have a significant 
economic impact on a substantial number of small entities or that the 
final rule duplicates, overlaps, or conflicts with any other Federal 
rules.

C. Use of Plain Language

    Section 722 of the Gramm-Leach-Bliley Act requires the Federal 
banking agencies to use plain language in all proposed and final rules 
published after January 1, 2000. The Board and Corporation invited 
comment on whether the proposed rule was written plainly and clearly, 
or whether there were ways the Board and Corporation could make the 
rule easier to understand. The Board and Corporation received no 
comments on these matters and believe that the final rule is written 
plainly and clearly.

Text of the Common Rules

(All Agencies)

PART [lsqbb] [rsqbb]--RESOLUTION PLANS

Sec.
----.1 Authority and scope.
----.2 Definitions.
----.3 Resolution plan required.
----.4 Informational content of a resolution plan.
----.5 Review of resolution plans; resubmission of deficient 
resolution plans.
----.6 Failure to cure deficiencies on resubmission of a resolution 
plan.
----.7 Consultation.
----.8 No limiting effect or private right of action; 
confidentiality of resolution plans.
----.9 Enforcement.


Sec.  ----.1  Authority and scope.

    (a) Authority. This part is issued pursuant to section 165(d)(8) of 
the Dodd-Frank Wall Street Reform and Consumer Protection Act (the 
Dodd-Frank Act) (Pub. L. 111-203, 124 Stat. 1376, 1426-1427), 12 U.S.C. 
5365(d)(8), which requires the Board of Governors of the Federal 
Reserve System (Board) and the Federal Deposit Insurance Corporation 
(Corporation) to jointly issue rules implementing the provisions of 
section 165(d) of the Dodd-Frank Act.
    (b) Scope. This part applies to each covered company and 
establishes rules and requirements regarding the submission and content 
of a resolution plan, as well as procedures for review by the Board and 
Corporation of a resolution plan.


Sec.  ----.2  Definitions.

    For purposes of this part:
    (a) Bankruptcy Code means Title 11 of the United States Code.
    (b) Company means a corporation, partnership, limited liability 
company, depository institution, business trust, special purpose 
entity, association, or similar organization, but does not include any 
organization, the majority of the voting securities of which are owned 
by the United States.
    (c) Control. A company controls another company when the first 
company, directly or indirectly, owns, or holds with power to vote, 25 
percent or more of any class of the second company's outstanding voting 
securities.
    (d) Core business lines means those business lines of the covered 
company, including associated operations, services, functions and 
support, that, in the view of the covered company, upon failure would 
result in a material loss of revenue, profit, or franchise value.
    (e) Council means the Financial Stability Oversight Council 
established by section 111 of the Dodd-Frank Act (12 U.S.C. 5321).
    (f) Covered company. (1) In general. A ``covered company'' means:
    (i) Any nonbank financial company supervised by the Board;
    (ii) Any bank holding company, as that term is defined in section 2 
of the Bank Holding Company Act, as amended (12 U.S.C. 1841), and the 
Board's Regulation Y (12 CFR part 225), that has $50 billion or more in 
total consolidated assets, as determined based on the average of the 
company's four most recent Consolidated Financial Statements for Bank 
Holding Companies as reported on the Federal Reserve's Form FR Y-9C 
(``FR Y-9C''); and
    (iii) Any foreign bank or company that is a bank holding company or 
is treated as a bank holding company under section 8(a) of the 
International Banking Act of 1978 (12 U.S.C. 3106(a)), and that has $50 
billion or more in total consolidated assets, as determined based on 
the foreign bank's or company's most recent annual or, as applicable, 
the average of the four most recent quarterly Capital and Asset Reports 
for Foreign Banking Organizations as reported on the Federal Reserve's 
Form FR Y-7Q (``FR Y-7Q'').
    (2) Once a covered company meets the requirements described in 
paragraph (f)(1)(ii) or (iii) of this section, the company shall remain 
a covered company for purposes of this part unless and until the 
company has less than $45 billion in total consolidated assets, as 
determined based on the--
    (i) Average total consolidated assets as reported on the company's 
four most recent FR Y-9Cs, in the case of a covered company described 
in paragraph (f)(1)(ii) of this section; or

[[Page 67335]]

    (ii) Total consolidated assets as reported on the company's most 
recent annual FR Y-7Q, or, as applicable, average total consolidated 
assets as reported on the company's four most recent quarterly FR Y-
7Qs, in the case of a covered company described in paragraph 
(f)(1)(iii) of this section.
    Nothing in this paragraph (f)(2) shall preclude a company from 
becoming a covered company pursuant to paragraph (f)(1) of this 
section.
    (3) Multi-tiered holding company. In a multi-tiered holding company 
structure, covered company means the top-tier of the multi-tiered 
holding company only.
    (4) Asset threshold for bank holding companies and foreign banking 
organizations. The Board may, pursuant to a recommendation of the 
Council, raise any asset threshold specified in paragraph (f)(1)(ii) or 
(iii) of this section.
    (5) Exclusion. A bridge financial company chartered pursuant to 12 
U.S.C. 5390(h) shall not be deemed to be a covered company hereunder.
    (g) Critical operations means those operations of the covered 
company, including associated services, functions and support, the 
failure or discontinuance of which, in the view of the covered company 
or as jointly directed by the Board and the Corporation, would pose a 
threat to the financial stability of the United States.
    (h) Depository institution has the same meaning as in section 
3(c)(1) of the Federal Deposit Insurance Act (12 U.S.C. 1813(c)(1)) and 
includes a state-licensed uninsured branch, agency, or commercial 
lending subsidiary of a foreign bank.
    (i) Foreign banking organization means--
    (1) A foreign bank, as defined in section 1(b)(7) of the 
International Banking Act of 1978 (12 U.S.C. 3101(7)), that:
    (i) Operates a branch, agency, or commercial lending company 
subsidiary in the United States;
    (ii) Controls a bank in the United States; or
    (iii) Controls an Edge corporation acquired after March 5, 1987; 
and
    (2) Any company of which the foreign bank is a subsidiary.
    (j) Foreign-based company means any covered company that is not 
incorporated or organized under the laws of the United States.
    (k) Functionally regulated subsidiary has the same meaning as in 
section 5(c)(5) of the Bank Holding Company Act, as amended (12 U.S.C. 
1844(c)(5)).
    (l) Material entity means a subsidiary or foreign office of the 
covered company that is significant to the activities of a critical 
operation or core business line (as defined in this part).
    (m) Material financial distress with regard to a covered company 
means that:
    (1) The covered company has incurred, or is likely to incur, losses 
that will deplete all or substantially all of its capital, and there is 
no reasonable prospect for the company to avoid such depletion;
    (2) The assets of the covered company are, or are likely to be, 
less than its obligations to creditors and others; or
    (3) The covered company is, or is likely to be, unable to pay its 
obligations (other than those subject to a bona fide dispute) in the 
normal course of business.
    (n) Nonbank financial company supervised by the Board means a 
nonbank financial company or other company that the Council has 
determined under section 113 of the Dodd-Frank Act (12 U.S.C. 5323) 
shall be supervised by the Board and for which such determination is 
still in effect.
    (o) Rapid and orderly resolution means a reorganization or 
liquidation of the covered company (or, in the case of a covered 
company that is incorporated or organized in a jurisdiction other than 
the United States, the subsidiaries and operations of such foreign 
company that are domiciled in the United States) under the Bankruptcy 
Code that can be accomplished within a reasonable period of time and in 
a manner that substantially mitigates the risk that the failure of the 
covered company would have serious adverse effects on financial 
stability in the United States.
    (p) Subsidiary means a company that is controlled by another 
company, and an indirect subsidiary is a company that is controlled by 
a subsidiary of a company.
    (q) United States means the United States and includes any state of 
the United States, the District of Columbia, any territory of the 
United States, Puerto Rico, Guam, American Samoa, and the Virgin 
Islands.


Sec.  ----.3  Resolution plan required.

    (a) Initial and annual resolution plans required.--(1) Each covered 
company shall submit its initial resolution plan to the Board and the 
Corporation on or before the date set forth below (``Initial Submission 
Date''):
    (i) July 1, 2012, with respect to any covered company that, as of 
the effective date of this part, had $250 billion or more in total 
nonbank assets (or, in the case of a covered company that is a foreign-
based company, in total U.S. nonbank assets);
    (ii) July 1, 2013, with respect to any covered company that is not 
described in paragraph (a)(1)(i) of this section, and that, as of the 
effective date of this part had $100 billion or more in total nonbank 
assets (or, in the case of a covered company that is a foreign-based 
company, in total U.S. nonbank assets); and
    (iii) December 31, 2013, with respect to any other covered company 
that is a covered company as of the effective date of this part but 
that is not described in paragraph (a)(1)(i) or (ii) of this section.
    (2) A company that becomes a covered company after the effective 
date of this part shall submit its initial resolution plan no later 
than the next July 1 following the date the company becomes a covered 
company, provided such date occurs no earlier than 270 days after the 
date on which the company became a covered company.
    (3) After filing its initial resolution plan pursuant to paragraph 
(a)(1) or (2) of this section, each covered company shall annually 
submit a resolution plan to the Board and the Corporation on or before 
each anniversary date of its Initial Submission Date.
    (4) Notwithstanding anything to the contrary in this paragraph (a), 
the Board and Corporation may jointly determine that a covered company 
shall file its initial or annual resolution plan by a date other than 
as provided in this paragraph (a). The Board and the Corporation shall 
provide a covered company with written notice of a determination under 
this paragraph (a)(4) no later than 180 days prior to the date on which 
the Board and Corporation jointly determined to require the covered 
company to submit its resolution plan.
    (b) Authority to require interim updates and notice of material 
events.--(1) In general. The Board and the Corporation may jointly 
require that a covered company file an update to a resolution plan 
submitted under paragraph (a) of this section, within a reasonable 
amount of time, as jointly determined by the Board and Corporation. The 
Board and the Corporation shall make a request pursuant to this 
paragraph (b)(1) in writing, and shall specify the portions or aspects 
of the resolution plan the covered company shall update.
    (2) Notice of material events. Each covered company shall provide 
the Board and the Corporation with a notice no later than 45 days after 
any event, occurrence, change in conditions or circumstances, or other 
change that results in, or could reasonably be foreseen to have, a 
material effect on the resolution plan of the covered company.

[[Page 67336]]

Such notice should describe the event, occurrence or change and explain 
why the event, occurrence or change may require changes to the 
resolution plan. The covered company shall address any event, 
occurrence or change with respect to which it has provided notice 
pursuant to this paragraph (b)(2) in the following resolution plan 
submitted by the covered company.
    (3) Exception. A covered company shall not be required to file a 
notice under paragraph (b)(2) of this section if the date on which the 
covered company would be required to submit the notice under paragraph 
(b)(2) would be within 90 days prior to the date on which the covered 
company is required to file an annual resolution plan under paragraph 
(a) of this section.
    (c) Authority to require more frequent submissions or extend time 
period.--The Board and Corporation may jointly:
    (1) Require that a covered company submit a resolution plan more 
frequently than required pursuant to paragraph (a) of this section; and
    (2) Extend the time period that a covered company has to submit a 
resolution plan or a notice following material events under paragraphs 
(a) and (b) of this section.
    (d) Access to information.--In order to allow evaluation of the 
resolution plan, each covered company must provide the Board and the 
Corporation such information and access to personnel of the covered 
company as the Board and the Corporation jointly determine during the 
period for reviewing the resolution plan is necessary to assess the 
credibility of the resolution plan and the ability of the covered 
company to implement the resolution plan. The Board and the Corporation 
will rely to the fullest extent possible on examinations conducted by 
or on behalf of the appropriate Federal banking agency for the relevant 
company.
    (e) Board of directors approval of resolution plan.--Prior to 
submission of a resolution plan under paragraph (a) of this section, 
the resolution plan of a covered company shall be approved by:
    (1) The board of directors of the covered company and noted in the 
minutes; or
    (2) In the case of a foreign-based covered company only, a delegee 
acting under the express authority of the board of directors of the 
covered company to approve the resolution plan.
    (f) Resolution plans provided to the Council.--The Board shall make 
the resolution plans and updates submitted by the covered company 
pursuant to this section available to the Council upon request.


Sec.  ----.4  Informational content of a resolution plan.

    (a) In general.--(1) Domestic covered companies. Except as 
otherwise provided in paragraph (a)(3) of this section, the resolution 
plan of a covered company that is organized or incorporated in the 
United States shall include the information specified in paragraphs (b) 
through (i) of this section with respect to the subsidiaries and 
operations that are domiciled in the United States as well as the 
foreign subsidiaries, offices, and operations of the covered company.
    (2) Foreign-based covered companies.--Except as otherwise provided 
in paragraph (a)(3) of the section, the resolution plan of a covered 
company that is organized or incorporated in a jurisdiction other than 
the United States (other than a bank holding company) or that is a 
foreign banking organization shall include:
    (i) The information specified in paragraphs (b) through (i) of this 
section with respect to the subsidiaries, branches and agencies, and 
critical operations and core business lines, as applicable, that are 
domiciled in the United States or conducted in whole or material part 
in the United States. With respect to the information specified in 
paragraph (g) of this section, the resolution plan of a foreign-based 
covered company shall also identify, describe in detail, and map to 
legal entity the interconnections and interdependencies among the U.S. 
subsidiaries, branches and agencies, and critical operations and core 
business lines of the foreign-based covered company and any foreign-
based affiliate; and
    (ii) A detailed explanation of how resolution planning for the 
subsidiaries, branches and agencies, and critical operations and core 
business lines of the foreign-based covered company that are domiciled 
in the United States or conducted in whole or material part in the 
United States is integrated into the foreign-based covered company's 
overall resolution or other contingency planning process.
    (3) Tailored resolution plan. (i) Eligible covered company.--
Paragraph (a)(3)(ii) of this section applies to any covered company 
that as of December 31 of the calendar year prior to the date its 
resolution plan is required to be submitted under this part--
    (A) Has less than $100 billion in total nonbank assets (or, in the 
case of a covered company that is a foreign-based company, in total 
U.S. nonbank assets); and
    (B) The total insured depository institution assets of which 
comprise 85 percent or more of the covered company's total consolidated 
assets (or, in the case of a covered company that is a foreign-based 
company, the assets of the U.S. insured depository institution 
operations, branches, and agencies of which comprise 85 percent or more 
of such covered company's U.S. total consolidated assets).
    (ii) Tailored resolution plan elements. A covered company described 
in paragraph (a)(3)(i) of this section may file a resolution plan that 
is limited to the following items--
    (A) An executive summary, as specified in paragraph (b) of this 
section;
    (B) The information specified in paragraphs (c) through (f) and 
paragraph (h) of this section, but only with respect to the covered 
company and its nonbanking material entities and operations;
    (C) The information specified in paragraphs (g) and (i) of this 
section with respect to the covered company and all of its insured 
depository institutions (or, in the case of a covered company that is a 
foreign-based company, the U.S. insured depository institutions, 
branches, and agencies) and nonbank material entities and operations. 
The interconnections and interdependencies identified pursuant to (g) 
of this section shall be included in the analysis provided pursuant to 
paragraph (c) of this section.
    (iii) Notice.--A covered company that meets the requirements of 
paragraph (a)(3)(i) of this section and that intends to submit a 
resolution plan pursuant to this paragraph (a)(3), shall provide the 
Board and Corporation with written notice of such intent and its 
eligibility under paragraph (a)(3)(i) no later than 270 days prior to 
the date on which the covered company is required to submit its 
resolution plan. Within 90 of receiving such notice, the Board and 
Corporation may jointly determine that the covered company must submit 
a resolution plan that meets some or all of the requirements as set 
forth in paragraph (a)(1) or (2) of this section, as applicable.
    (4) Required and prohibited assumptions.--In preparing its plan for 
rapid and orderly resolution in the event of material financial 
distress or failure required by this part, a covered company shall:
    (i) Take into account that such material financial distress or 
failure of the covered company may occur under the baseline, adverse 
and severely adverse economic conditions provided to the covered 
company by the Board pursuant to 12 U.S.C. 5365(i)(1)(B); provided, 
however, a covered company

[[Page 67337]]

may submit its initial resolution plan assuming the baseline conditions 
only, or, if a baseline scenario is not then available, a reasonable 
substitute developed by the covered company; and
    (ii) Not rely on the provision of extraordinary support by the 
United States or any other government to the covered company or its 
subsidiaries to prevent the failure of the covered company.
    (b) Executive summary.--Each resolution plan of a covered company 
shall include an executive summary describing:
    (1) The key elements of the covered company's strategic plan for 
rapid and orderly resolution in the event of material financial 
distress at or failure of the covered company.
    (2) Material changes to the covered company's resolution plan from 
the company's most recently filed resolution plan (including any 
notices following a material event or updates to the resolution plan).
    (3) Any actions taken by the covered company since filing of the 
previous resolution plan to improve the effectiveness of the covered 
company's resolution plan or remediate or otherwise mitigate any 
material weaknesses or impediments to effective and timely execution of 
the resolution plan.
    (c) Strategic analysis.--Each resolution plan shall include a 
strategic analysis describing the covered company's plan for rapid and 
orderly resolution in the event of material financial distress or 
failure of the covered company. Such analysis shall--
    (1) Include detailed descriptions of the--
    (i) Key assumptions and supporting analysis underlying the covered 
company's resolution plan, including any assumptions made concerning 
the economic or financial conditions that would be present at the time 
the covered company sought to implement such plan;
    (ii) Range of specific actions to be taken by the covered company 
to facilitate a rapid and orderly resolution of the covered company, 
its material entities, and its critical operations and core business 
lines in the event of material financial distress or failure of the 
covered company;
    (iii) Funding, liquidity and capital needs of, and resources 
available to, the covered company and its material entities, which 
shall be mapped to its critical operations and core business lines, in 
the ordinary course of business and in the event of material financial 
distress at or failure of the covered company;
    (iv) Covered company's strategy for maintaining operations of, and 
funding for, the covered company and its material entities, which shall 
be mapped to its critical operations and core business lines;
    (v) Covered company's strategy in the event of a failure or 
discontinuation of a material entity, core business line or critical 
operation, and the actions that will be taken by the covered company to 
prevent or mitigate any adverse effects of such failure or 
discontinuation on the financial stability of the United States; 
provided, however, if any such material entity is subject to an 
insolvency regime other than the Bankruptcy Code, a covered company may 
exclude that entity from its strategic analysis unless that entity 
either has $50 billion or more in total assets or conducts a critical 
operation; and
    (vi) Covered company's strategy for ensuring that any insured 
depository institution subsidiary of the covered company will be 
adequately protected from risks arising from the activities of any 
nonbank subsidiaries of the covered company (other than those that are 
subsidiaries of an insured depository institution);
    (2) Identify the time period(s) the covered company expects would 
be needed for the covered company to successfully execute each material 
aspect and step of the covered company's plan;
    (3) Identify and describe any potential material weaknesses or 
impediments to effective and timely execution of the covered company's 
plan;
    (4) Discuss the actions and steps the covered company has taken or 
proposes to take to remediate or otherwise mitigate the weaknesses or 
impediments identified by the covered company, including a timeline for 
the remedial or other mitigatory action; and
    (5) Provide a detailed description of the processes the covered 
company employs for:
    (i) Determining the current market values and marketability of the 
core business lines, critical operations, and material asset holdings 
of the covered company;
    (ii) Assessing the feasibility of the covered company's plans 
(including timeframes) for executing any sales, divestitures, 
restructurings, recapitalizations, or other similar actions 
contemplated in the covered company's resolution plan; and
    (iii) Assessing the impact of any sales, divestitures, 
restructurings, recapitalizations, or other similar actions on the 
value, funding, and operations of the covered company, its material 
entities, critical operations and core business lines.
    (d) Corporate governance relating to resolution planning.--Each 
resolution plan shall:
    (1) Include a detailed description of:
    (i) How resolution planning is integrated into the corporate 
governance structure and processes of the covered company;
    (ii) The covered company's policies, procedures, and internal 
controls governing preparation and approval of the covered company's 
resolution plan;
    (iii) The identity and position of the senior management 
official(s) of the covered company that is primarily responsible for 
overseeing the development, maintenance, implementation, and filing of 
the covered company's resolution plan and for the covered company's 
compliance with this part; and
    (iv) The nature, extent, and frequency of reporting to senior 
executive officers and the board of directors of the covered company 
regarding the development, maintenance, and implementation of the 
covered company's resolution plan;
    (2) Describe the nature, extent, and results of any contingency 
planning or similar exercise conducted by the covered company since the 
date of the covered company's most recently filed resolution plan to 
assess the viability of or improve the resolution plan of the covered 
company; and
    (3) Identify and describe the relevant risk measures used by the 
covered company to report credit risk exposures both internally to its 
senior management and board of directors, as well as any relevant risk 
measures reported externally to investors or to the covered company's 
appropriate Federal regulator.
    (e) Organizational structure and related information.--Each 
resolution plan shall--
    (1) Provide a detailed description of the covered company's 
organizational structure, including:
    (i) A hierarchical list of all material entities within the covered 
company's organization (including legal entities that directly or 
indirectly hold such material entities) that:
    (A) Identifies the direct holder and the percentage of voting and 
nonvoting equity of each legal entity and foreign office listed; and
    (B) The location, jurisdiction of incorporation, licensing, and key 
management associated with each material legal entity and foreign 
office identified;
    (ii) A mapping of the covered company's critical operations and 
core business lines, including material asset

[[Page 67338]]

holdings and liabilities related to such critical operations and core 
business lines, to material entities;
    (2) Provide an unconsolidated balance sheet for the covered company 
and a consolidating schedule for all material entities that are subject 
to consolidation by the covered company;
    (3) Include a description of the material components of the 
liabilities of the covered company, its material entities, critical 
operations and core business lines that, at a minimum, separately 
identifies types and amounts of the short-term and long-term 
liabilities, the secured and unsecured liabilities, and subordinated 
liabilities;
    (4) Identify and describe the processes used by the covered company 
to:
    (i) Determine to whom the covered company has pledged collateral;
    (ii) Identify the person or entity that holds such collateral; and
    (iii) Identify the jurisdiction in which the collateral is located, 
and, if different, the jurisdiction in which the security interest in 
the collateral is enforceable against the covered company;
    (5) Describe any material off-balance sheet exposures (including 
guarantees and contractual obligations) of the covered company and its 
material entities, including a mapping to its critical operations and 
core business lines;
    (6) Describe the practices of the covered company, its material 
entities and its core business lines related to the booking of trading 
and derivatives activities;
    (7) Identify material hedges of the covered company, its material 
entities, and its core business lines related to trading and derivative 
activities, including a mapping to legal entity;
    (8) Describe the hedging strategies of the covered company;
    (9) Describe the process undertaken by the covered company to 
establish exposure limits;
    (10) Identify the major counterparties of the covered company and 
describe the interconnections, interdependencies and relationships with 
such major counterparties;
    (11) Analyze whether the failure of each major counterparty would 
likely have an adverse impact on or result in the material financial 
distress or failure of the covered company; and
    (12) Identify each trading, payment, clearing, or settlement system 
of which the covered company, directly or indirectly, is a member and 
on which the covered company conducts a material number or value amount 
of trades or transactions. Map membership in each such system to the 
covered company's material entities, critical operations and core 
business lines.
    (f) Management information systems.--(1) Each resolution plan shall 
include--
    (i) A detailed inventory and description of the key management 
information systems and applications, including systems and 
applications for risk management, accounting, and financial and 
regulatory reporting, used by the covered company and its material 
entities. The description of each system or application provided shall 
identify the legal owner or licensor, the use or function of the system 
or application, service level agreements related thereto, any software 
and system licenses, and any intellectual property associated 
therewith;
    (ii) A mapping of the key management information systems and 
applications to the material entities, critical operations and core 
business lines of the covered company that use or rely on such systems 
and applications;
    (iii) An identification of the scope, content, and frequency of the 
key internal reports that senior management of the covered company, its 
material entities, critical operations and core business lines use to 
monitor the financial health, risks, and operation of the covered 
company, its material entities, critical operations and core business 
lines; and
    (iv) A description of the process for the appropriate supervisory 
or regulatory agencies to access the management information systems and 
applications identified in paragraph (f) of this section; and
    (v) A description and analysis of--
    (A) The capabilities of the covered company's management 
information systems to collect, maintain, and report, in a timely 
manner to management of the covered company, and to the Board, the 
information and data underlying the resolution plan; and
    (B) Any deficiencies, gaps or weaknesses in such capabilities, and 
a description of the actions the covered company intends to take to 
promptly address such deficiencies, gaps, or weaknesses, and the time 
frame for implementing such actions.
    (2) The Board will use its examination authority to review the 
demonstrated capabilities of each covered company to satisfy the 
requirements of paragraph (f)(1)(v) of this section. The Board will 
share with the Corporation information regarding the capabilities of 
the covered company to collect, maintain, and report in a timely manner 
information and data underlying the resolution plan.
    (g) Interconnections and interdependencies. To the extent not 
elsewhere provided, identify and map to the material entities the 
interconnections and interdependencies among the covered company and 
its material entities, and among the critical operations and core 
business lines of the covered company that, if disrupted, would 
materially affect the funding or operations of the covered company, its 
material entities, or its critical operations or core business lines. 
Such interconnections and interdependencies may include:
    (1) Common or shared personnel, facilities, or systems (including 
information technology platforms, management information systems, risk 
management systems, and accounting and recordkeeping systems);
    (2) Capital, funding, or liquidity arrangements;
    (3) Existing or contingent credit exposures;
    (4) Cross-guarantee arrangements, cross-collateral arrangements, 
cross-default provisions, and cross-affiliate netting agreements;
    (5) Risk transfers; and
    (6) Service level agreements.
    (h) Supervisory and regulatory information. Each resolution plan 
shall--
    (1) Identify any:
    (i) Federal, state, or foreign agency or authority (other than a 
Federal banking agency) with supervisory authority or responsibility 
for ensuring the safety and soundness of the covered company, its 
material entities, critical operations and core business lines; and
    (ii) Other Federal, state, or foreign agency or authority (other 
than a Federal banking agency) with significant supervisory or 
regulatory authority over the covered company, and its material 
entities and critical operations and core business lines.
    (2) Identify any foreign agency or authority responsible for 
resolving a foreign-based material entity and critical operations or 
core business lines of the covered company; and
    (3) Include contact information for each agency identified in 
paragraphs (h)(1) and (2) of this section.
    (i) Contact information. Each resolution plan shall identify a 
senior management official at the covered company responsible for 
serving as a point of contact regarding the resolution plan of the 
covered company, and include contact information (including phone 
number, email address, and physical address) for a senior management 
official of the material entities of the covered company.
    (j) Inclusion of previously submitted resolution plan informational 
elements by reference. An annual submission of

[[Page 67339]]

or update to a resolution plan submitted by a covered company may 
include by reference informational elements (but not strategic analysis 
or executive summary elements) from a resolution plan previously 
submitted by the covered company to the Board and the Corporation, 
provided that:
    (1) The resolution plan seeking to include informational elements 
by reference clearly indicates:
    (i) The informational element the covered company is including by 
reference; and
    (ii) Which of the covered company's previously submitted resolution 
plan(s) originally contained the information the covered company is 
including by reference; and
    (2) The covered company certifies that the information the covered 
company is including by reference remains accurate.
    (k) Exemptions. The Board and the Corporation may jointly exempt a 
covered company from one or more of the requirements of this section.


Sec.  ----.5  Review of resolution plans; resubmission of deficient 
resolution plans.

    (a) Acceptance of submission and review. (1) The Board and 
Corporation shall review a resolution plan submitted under section this 
subpart within 60 days.
    (2) If the Board and Corporation jointly determine within the time 
described in paragraph (a)(1) of this section that a resolution plan is 
informationally incomplete or that substantial additional information 
is necessary to facilitate review of the resolution plan:
    (i) The Board and Corporation shall jointly inform the covered 
company in writing of the area(s) in which the resolution plan is 
informationally incomplete or with respect to which additional 
information is required; and
    (ii) The covered company shall resubmit an informationally complete 
resolution plan or such additional information as jointly requested to 
facilitate review of the resolution plan no later than 30 days after 
receiving the notice described in paragraph (a)(2)(i) of this section, 
or such other time period as the Board and Corporation may jointly 
determine.
    (b) Joint determination regarding deficient resolution plans. If 
the Board and Corporation jointly determine that the resolution plan of 
a covered company submitted under Sec.  ----.3(a) is not credible or 
would not facilitate an orderly resolution of the covered company under 
the Bankruptcy Code, the Board and Corporation shall jointly notify the 
covered company in writing of such determination. Any joint notice 
provided under this paragraph shall identify the aspects of the 
resolution plan that the Board and Corporation jointly determined to be 
deficient.
    (c) Resubmission of a resolution plan. Within 90 days of receiving 
a notice of deficiencies issued pursuant to paragraph (b) of this 
section, or such shorter or longer period as the Board and Corporation 
may jointly determine, a covered company shall submit a revised 
resolution plan to the Board and Corporation that addresses the 
deficiencies jointly identified by the Board and Corporation, and that 
discusses in detail:
    (1) The revisions made by the covered company to address the 
deficiencies jointly identified by the Board and the Corporation;
    (2) Any changes to the covered company's business operations and 
corporate structure that the covered company proposes to undertake to 
facilitate implementation of the revised resolution plan (including a 
timeline for the execution of such planned changes); and
    (3) Why the covered company believes that the revised resolution 
plan is credible and would result in an orderly resolution of the 
covered company under the Bankruptcy Code.
    (d) Extensions of time. Upon their own initiative or a written 
request by a covered company, the Board and Corporation may jointly 
extend any time period under this section. Each extension request shall 
be supported by a written statement of the covered company describing 
the basis and justification for the request.


Sec.  ----.6  Failure to cure deficiencies on resubmission of a 
resolution plan.

    (a) In general. The Board and Corporation may jointly determine 
that a covered company or any subsidiary of a covered company shall be 
subject to more stringent capital, leverage, or liquidity requirements, 
or restrictions on the growth, activities, or operations of the covered 
company or the subsidiary if:
    (1) The covered company fails to submit a revised resolution plan 
under Sec.  ----.5(c) within the required time period; or
    (2) The Board and the Corporation jointly determine that a revised 
resolution plan submitted under Sec.  ----.5(c) does not adequately 
remedy the deficiencies jointly identified by the Board and the 
Corporation under Sec.  ----.5(b).
    (b) Duration of requirements or restrictions.--Any requirements or 
restrictions imposed on a covered company or a subsidiary thereof 
pursuant to paragraph (a) of this section shall cease to apply to the 
covered company or subsidiary, respectively, on the date that the Board 
and the Corporation jointly determine the covered company has submitted 
a revised resolution plan that adequately remedies the deficiencies 
jointly identified by the Board and the Corporation under Sec.  --
--.5(b).
    (c) Divestiture. The Board and Corporation, in consultation with 
the Council, may jointly, by order, direct the covered company to 
divest such assets or operations as are jointly identified by the Board 
and Corporation if:
    (1) The Board and Corporation have jointly determined that the 
covered company or a subsidiary thereof shall be subject to 
requirements or restrictions pursuant to paragraph (a) of this section; 
and
    (2) The covered company has failed, within the 2-year period 
beginning on the date on which the determination to impose such 
requirements or restrictions under paragraph (a) of this section was 
made, to submit a revised resolution plan that adequately remedies the 
deficiencies jointly identified by the Board and the Corporation under 
Sec.  ----.5(b); and
    (3) The Board and Corporation jointly determine that the 
divestiture of such assets or operations is necessary to facilitate an 
orderly resolution of the covered company under the Bankruptcy Code in 
the event the company was to fail.


Sec.  ----.7  Consultation.

    Prior to issuing any notice of deficiencies under Sec.  ----.5(b), 
determining to impose requirements or restrictions under Sec.  --
--.6(a), or issuing a divestiture order pursuant to Sec.  ----.6(c) 
with respect to a covered company that is likely to have a significant 
impact on a functionally regulated subsidiary or a depository 
institution subsidiary of the covered company, the Board--
    (a) Shall consult with each Council member that primarily 
supervises any such subsidiary; and
    (b) May consult with any other Federal, state, or foreign 
supervisor as the Board considers appropriate.


Sec.  ----.8  No limiting effect or private right of action; 
confidentiality of resolution plans.

    (a) No limiting effect on bankruptcy or other resolution 
proceedings.--A resolution plan submitted pursuant to this part shall 
not have any binding effect on:
    (1) A court or trustee in a proceeding commenced under the 
Bankruptcy Code;

[[Page 67340]]

    (2) A receiver appointed under Title II of the Dodd-Frank Act (12 
U.S.C. 5381 et seq.);
    (3) A bridge financial company chartered pursuant to 12 U.S.C. 
5390(h); or
    (4) Any other authority that is authorized or required to resolve a 
covered company (including any subsidiary or affiliate thereof) under 
any other provision of Federal, state, or foreign law.
    (b) No private right of action.--Nothing in this part creates or is 
intended to create a private right of action based on a resolution plan 
prepared or submitted under this part or based on any action taken by 
the Board or the Corporation with respect to any resolution plan 
submitted under this part.
    (c) Form of resolution plans. Each resolution plan of a covered 
company shall be divided into a public section and a confidential 
section. Each covered company shall segregate and separately identify 
the public section from the confidential section. The public section 
shall consist of an executive summary of the resolution plan that 
describes the business of the covered company and includes, to the 
extent material to an understanding of the covered company:
    (1) The names of material entities;
    (2) A description of core business lines;
    (3) Consolidated or segment financial information regarding assets, 
liabilities, capital and major funding sources;
    (4) A description of derivative activities and hedging activities;
    (5) A list of memberships in material payment, clearing and 
settlement systems;
    (6) A description of foreign operations;
    (7) The identities of material supervisory authorities;
    (8) The identities of the principal officers;
    (9) A description of the corporate governance structure and 
processes related to resolution planning;
    (10) A description of material management information systems; and
    (11) A description, at a high level, of the covered company's 
resolution strategy, covering such items as the range of potential 
purchasers of the covered company, its material entities and core 
business lines.
    (d) Confidential treatment of resolution plans. (1) The 
confidentiality of resolution plans and related materials shall be 
determined in accordance with applicable exemptions under the Freedom 
of Information Act (5 U.S.C. 552(b)) and the Board's Rules Regarding 
Availability of Information (12 CFR part 261), and the Corporation's 
Disclosure of Information Rules (12 CFR part 309).
    (2) Any covered company submitting a resolution plan or related 
materials pursuant to this part that desires confidential treatment of 
the information under 5 U.S.C. 552(b)(4), the Board's Rules Regarding 
Availability of Information (12 CFR part 261), and the Corporation's 
Disclosure of Information Rules (12 CFR part 309) may file a request 
for confidential treatment in accordance with those rules.
    (3) To the extent permitted by law, information comprising the 
Confidential Section of a resolution plan will be treated as 
confidential.
    (4) To the extent permitted by law, the submission of any nonpublic 
data or information under this part shall not constitute a waiver of, 
or otherwise affect, any privilege arising under Federal or state law 
(including the rules of any Federal or state court) to which the data 
or information is otherwise subject. Privileges that apply to 
resolution plans and related materials are protected pursuant to 
Section 18(x) of the FDI Act, 12 U.S.C. 1828(x).


Sec.  ----.9  Enforcement.

    The Board and Corporation may jointly enforce an order jointly 
issued by the Board and Corporation under Sec.  ----.6(a) or ----.6(c) 
of this part. The Board, in consultation with the Corporation, may take 
any action to address any violation of this part by a covered company 
under section 8 of the Federal Deposit Insurance Act (12 U.S.C. 1818).

[End of Common Text]

List of Subjects

12 CFR Part 243

    Administrative practice and procedure, Banks, Banking, Federal 
Reserve System, Holding companies, Reporting and recordkeeping 
requirements, Securities.

12 CFR Part 381

    Administrative practice and procedure, Banks, Banking, Holding 
companies, Reporting and recordkeeping requirements, Resolution plans 
and credit exposure reports.

Adoption of Common Rule

    The adoption of the common rules by the agencies, as modified by 
agency-specific text, is set forth below:

BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM

12 CFR Chapter II

Authority and Issuance

    For the reasons stated in the Supplementary Information, the Board 
of Governors of the Federal Reserve System adds the text of the common 
rule, as set forth at the end of the Supplementary Information, as Part 
243 to Chapter II of Title 12, modified as follows:

PART 243--RESOLUTION PLANS (REGULATION QQ)

0
1. The authority citation for part 243 reads as follows:

    Authority:  12 U.S.C. 5365.

FEDERAL DEPOSIT INSURANCE CORPORATION

12 CFR Chapter III

Authority and Issuance

    For the reasons set forth in the Supplementary Information, the 
Federal Deposit Insurance Corporation to adds the text of the common 
rule, as set forth at the end of the Supplementary Information, as Part 
381 to Chapter III of Title 12, Code of Federal Regulations, modified 
as follows:

PART 381--RESOLUTION PLANS

0
1. The authority citation for part 381 reads as follows:

    Authority:  12 U.S.C. 5365(d).

    By order of the Board of Governors of the Federal Reserve 
System, October 14, 2011.
Jennifer J. Johnson,
Secretary of the Board.
    Dated at Washington, DC, this 13th day of September 2011.

By order of the Board of Directors.

Federal Deposit Insurance Corporation.

Robert E. Feldman,
Executive Secretary.
[FR Doc. 2011-27377 Filed 10-31-11; 8:45 am]
BILLING CODE 6210-01-P