Major U.S. Banks' Living Wills Found Deficient; Citigroup Faces Severe Criticism

June 22, 2024
Major U.S. Banks' Living Wills Found Deficient; Citigroup Faces Severe Criticism
  • Federal regulators have identified weaknesses in the resolution plans, or living wills, of major U.S. banks, including Bank of America, Citigroup, Goldman Sachs, and JPMorgan Chase.

  • The primary issues involve the banks' ability to unwind their derivatives portfolios during times of distress, with deficiencies in trade-level characteristics and financial results compilation.

  • Citigroup was specifically noted for more severe deficiencies, particularly in stress scenarios and data reliability.

  • The FDIC and Federal Reserve differed in their assessment of Citigroup's weaknesses, with the FDIC viewing them as more serious.

  • Banks have until July 1, 2025, to address the identified shortcomings and submit updated plans.

  • Other major banks such as Bank of New York Mellon, Morgan Stanley, State Street, and Wells Fargo did not face any issues with their resolution plans.

  • Resolution plans were mandated following the 2008 financial crisis to ensure a swift and orderly resolution in case of financial distress or failure.

Summary based on 4 sources


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