Fed approves final rule on bank resolution plans

The Federal Reserve Board approved a final rule Monday that forces bank holding companies with $50 billion or more in assets and certain nonbank firms to submit resolution plans explaining how they would wind down their businesses in times of stress. The rule, which is a part of the Dodd-Frank Wall Street Reform and Consumer Protection Act, requires applicable bank holding companies, as well as nonbank financial firms supervised by the Financial Stability Oversight Council, to submit bankruptcy resolution plans to the Federal Reserve and the Federal Deposit Insurance Corp. The rule says firms should outline detailed plans explaining how they would implement a timely bankruptcy. The Fed and FDIC plan to collect the outlines on a staggered basis. Companies with $250 billion or more in non-bank assets are expected to submit their resolution plans on or before July 1, 2012. The second group – those with $100 billion or more in non-bank assets, but less than $250 billion – will have to submit their plans on or before July 1, 2013. The remaining companies will have to submit their outlines on or before Dec. 31, 2013. Write to Kerri Panchuk.

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