Statement of Martin J. Gruenberg, Chairman Federal Deposit Insurance Corporation Title 1 Resolution Plans – Guidance for Triennial Full Filers

The Dodd-Frank Act established a statutory requirement for certain companies to develop plans for their rapid and orderly resolution. The FDIC Board is considering today issuing final guidance, jointly with the Board of Governors of the Federal Reserve System, regarding resolution plans required under Title I of the Dodd-Frank Act for certain companies, generally with assets greater than $250 billion. In particular, this guidance would apply to the "triennial full filers," a group that includes the largest regional banks.

The implementation of the Title I Rule has been an iterative process aimed at strengthening the resolution planning capabilities of financial institutions subject to the Rule. To assist covered companies in developing their resolution plan submissions and operational capabilities, the agencies have provided feedback on individual plan submissions, issued guidance to certain groups of covered companies, and issued answers to frequently asked questions. The agencies have not, however, thus far issued guidance to domestic triennial full filers or most of the foreign-based triennial full filers.

Guidance does not carry the force of law and it is not institution-specific, but it can help focus the efforts of similarly situated covered companies to improve their resolution capabilities and clarify the agencies' expectations for those filers' future progress in their resolution plans.

The guidance that the Board is considering today draws upon guidance that the FDIC and the Federal Reserve previously issued to the U.S. global systemically important banking organizations and certain large foreign banks but also makes appropriate modifications for the structure and complexity of this group of firms, incorporates observations drawn from analyzing prior resolution plan submissions from the triennial full filers, and reflects lessons learned from the failures of March 2023. Important matters addressed within this guidance include the following:

• The agencies are continuing the historical practice of not prescribing a specific resolution strategy for any firm. Each company remains free to choose the resolution strategy it believes would most effectively facilitate a rapid and orderly resolution. The attention paid to the Multiple Point of Entry (or MPOE) strategy in developing this guidance should be understood as a clear statement that selection of the MPOE approach to resolution remains a viable option.
• The Single Point of Entry (or SPOE) and MPOE resolution strategies address different vulnerabilities and require different planning and different types of capabilities. This guidance recognizes those differences and provides expectations that reflect those differences.
• The failure of a large regional bank can present the risk of disruption to U.S. financial stability. Many of the companies subject to this guidance operate insured bank subsidiaries that are larger and more complex than those that failed in 2023 and necessitated the use of the systemic risk exception. It is essential that all covered companies develop resolution plans that allow for their rapid and orderly resolution without depending upon extraordinary government action or taxpayer support.

This guidance will help ensure that the triennial full filers develop appropriate resolution plans to mitigate the risk that their failure could have serious adverse effects on U.S. financial stability. I support the guidance as well as the extension of the next submission date so that covered companies can fully consider the guidance. I would like to thank staffs of the FDIC and the Federal Reserve for their efforts in collaborating to develop this guidance to help improve the resolvability of large regional and foreign banks.