Written by Wilfred Ling Wednesday, 21 September 2011
According to the report
'Living Wills' Due Next Year, US banks have up to 2012 summer with a road map for liquidating the companies if they fail. The reason? The new financial law will help regulators better understand the structure of complex financial firms whose failures could wreak havoc on the financial system before crisis actually occurs. Apparently in 2008, regulators struggled and had a hard time understanding the complex nature of the firms that were undergoing trouble. The requirement for regulators to mandate financial institutions like these US banks to have ‘road-maps’ for liquidation in the event of failure is a brilliant idea because it serves the following purpose:
- These ‘road-maps’ will be able to help government better understand the organization structure of these firms.
- It forces firms to understand itself better. I am not surprised that these firms ...
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