FSB has reported on the progress of international initiatives designed to solve the problem of institutions being too big to fail. It is pleased with progress but highlights several areas for further action. It identified the need:
- for legislative reforms to implement the “Key Attributes of Effective Resolution Regimes for Financial Institutions” by 2015. It says changes must cover all parts of the financial sector that could cause systemic problems, including insurers and key market infrastructures;
- to improve information sharing and co-operation between regulators;
- to make resolution effective in a cross-border context;
- to deal with complexities in firms’ legal, financial and operational structures that make resolution difficult;
- for domestic legislation to reinforce resolution arrangements, and to designate domestic systemically important banks; and
- to ensure regulators are able to resource themselves properly to deal with effective resolutions.
(Source: FSB Reports on Too-Big-To-Fail)