WASHINGTON – The FDIC said it is modifying its approach to insured depository institution (IDI) resolution planning. 

According to the FDIC, the purpose of the change is to “focus the IDI resolution planning process on the operational information most relevant for the FDIC” to:

• Resolve a large bank through a weekend sale or..
• Operate the institution for a short period of time while rapidly marketing the institution  

Some Exemptions

For full resolution submissions during the upcoming submission cycle, the FDIC said it has exempted IDIs from certain content requirements, such as the requirements to utilize a bridge bank strategy and a hypothetical failure scenario in the plan.  

“The 2023 bank failures served as a reminder of how costly and damaging a bridge bank solution can be,” Acting Chairman Travis Hill said in a statement. “Today’s action is one step in shifting our approach towards maximizing the likelihood of a lower cost and more stabilizing resolution for large regional banks.” 

Additional Moves

In addition, the FDIC has issued an updated set of frequently asked questions (FAQs) describing the exemptions and clarifying certain expectations. 

The agency said it is also continuing to evaluate other provisions in the IDI Rule, and their applicability to different cohorts of banks, and may issue additional FAQs at a later date.