IBFed responds to FSB consultative document on effective resolution of SIFIs -05/09/11

5 Sep 2011

IBFed has responded to the consultative document on the Effective Resolution of Systemically Important Financial Institutions, published by the Financial Stability Board (FSB).
We expressed support for the creation of special resolution regimes for financial institutions that minimise the systemic and fiscal consequences of bank failures and eliminate moral hazard, thereby allowing market forces to exert greater market discipline and a fair allocation of losses.
We also noted that the proposals to strengthen cross-border cooperation in the case of a crisis represent a good step forward, and strongly supported the underlying conclusion of the report that internationally coordinated reform of domestic resolution regimes and frameworks for cross-border enforcement of resolution actions, need to be accelerated.

The IBFed letter is available here.