On 13 November 2024, the Financial Stability Board (FSB) issued a public statement that sought to clarify the importance of resolution preparedness for those banks that are not global systemically important (G-SIB) but may be systemically significant or critical if they fail.

The public statement is informed by a workshop that the FSB held on banks systemic in failure following the March 2023 bank failures. It sets out certain considerations to inform jurisdictions’ regulatory and policy frameworks for the resolution preparedness of banks systemic in failure. The considerations are set out under the following headings:

• Authorities should assess which banks may be systemically significant or critical if they fail.
• Authorities and banks systemic in failure should be prepared for resolution.
• Authorities should consider the need for loss-absorbing capacity.

The public statement also recognises the cross-border element and that it is important for authorities to consider potential spillover effects when considering the resolvability of a bank.

Besides its work on G-SIBs, the FSB will continue to consider banks systemic in failure in its future work on bank resolution planning topics.