Our finding that the largest banks, the largest nonbanks, and the largest nonfinancial corporations all benefit from a discount relative to their smaller peers in the bond market can be interpreted as some support for the view that the
too-big-to-fail status does not apply solely to banks.
On the issue of ending
too-big-to-fail, the FSB last week put forward a proposal on total loss-absorbing capacity, otherwise known as TLAC, for globally systemically important banks.
That is the key pending aspect on ending
too-big-to-fail," said Andres Portilla, director of regulatory affairs at the Institute of International Finance, a Washington-based banking and insurance lobby.
This legislation deals with the small number of very large banks which otherwise might still be
too-big-to-fail, too-costly-to save, too-complex-to-resolve," Michel Barnier, EU Commissioner for internal market and services, told a press conference presenting the proposals.
The country's four largest providers Barclays, Royal Bank of Scotland, HSBC and Lloyds have cashed in on a
too-big-to-fail government subsidy, claim the think-tank the New Economics Foundation.
He waged public battles against regulators who correctly argued for regulating derivatives and disparaged the comments of a prominent economist who early on identified risks in the
too-big-to-fail banking system.
We are building more resilient financial institutions, making substantial progress towards ending
too-big-to-fail, increasing transparency and market integrity, filling regulatory gaps and addressing the risks from shadow banking.
There's finally a healthy discussion in Washington about how to end
too-big-to-fail banks.
They then present the Dallas Federal Reserve recommendations on how
too-big-to-fail can be remedied.
There has been "substantial progress but more progress to be made," Lew said in open remarks on
too-big-to-fail and on FSOC's progress.
What I want to do in this review is to use the books' analyses of AIG and Merrill Lynch to give some insight into how large financial institutions are run, their risks, why some of them failed in the recent crisis, and the implications for
too-big-to-fail policy.
The
too-big-to-fail reform project is massive in scope.
