Recently, the Federal Reserve Board proposed new regulations, based on recommendations from international regulators, to require global systemically important US banks, and such non-US banks with US operations, to maintain a “total loss-absorbing capacity” ratio that would be satisfied by maintaining additional capital and issuing certain types of unsecured long term debt.

Kathleen A. Scott wrote a recent column in The New York Law Journal that discusses this proposal and its intent to strengthen the resiliency of these systemically important banks on an ongoing basis and provide for a more orderly resolution if one of them should fail.

Read the article: ‘Total Loss-Absorbing Capacity” Proposal Comes to the United States.’