U.S. banking regulators are giving three big financial institutions an extra six months to get their living wills in order.
The U.S. Federal Reserve Board and the Federal Deposit Insurance Corp. (FDIC) said Wednesday they are extending the deadline for resolution plans from American International Group, Inc. (AIG), General Electric Capital Corp., Inc., and Prudential Financial, Inc. The three firms will now have until Dec. 31, to file the latest version of their wind-up plans, instead of the original July 1 deadline.
The agencies says that the grace period is consistent with similar extensions that have been provided to other financial firms in previous years, and that this will allow the firms additional time to develop their plans.
The requirement to produce these plans was introduced in the wake of the financial crisis as part of U.S. reforms designed o ensure that a major financial firm can be wound down if it fails, rather than requiring a bailout, or causing wider systemic damage. Under the rules, banks with total consolidated assets of US$50 billion or more, and non-bank financial companies designated by the Financial Stability Oversight Council (FSOC), must periodically submit resolution plans to regulators.