Gruenberg discusses resolution of SIFIs

In remarks at the Wharton School University of Pennsylvania, FDIC Chairman Gruenberg addressed the issue of the resolution of systemically important financial institutions (SIFIs). He discussed building a framework for systemic resolution, the evolution of the living will process, the April 2016 filing of firms plans, and the progress made. Gruenberg summarized, “the living wills process has proven enormously helpful to firms and regulators. It has facilitated significant structural and operational improvements within firms to improve their resolvability. The process has been institutionalized and integrated into both the firms’ business-as-usual planning and operations and the regulators’ supervisory and resolution-planning processes. The progress made resulted from an evolving and highly cooperative process over several years.” He concluded, "Options and tools now exist that provide a path far better than existed in 2008 to help ensure that a systemic firm can fail, that shareholders, creditors, and management of the firm bear the consequences of their decisions, and that financial stability can be preserved during times of stress without taxpayer bailouts. It is critical that this important work continue.“