WASHINGTON, Aug 22 (Reuters) – U.S. bank regulator the Federal Deposit and Insurance Corporation (FDIC) will on Aug. 29 propose new rules overhauling how large regional banks prepare for their own failure, according to a notice published late on Tuesday.
U.S. regulators are seeking to strengthen oversight of the banking system, particularly in light of a string of collapses this year that included three of the largest in U.S. history.
The proposal will likely require banks of $100 billion or more in assets to issue long-term debt that could absorb bank losses before depositors and the FDIC’s deposit insurance fund do, FDIC Chair Martin Gruenberg said in a speech this month.
It will also require bank recovery and resolution plans, also known as “living wills,” to give the FDIC more options when overseeing a failed bank’s receivership, including by identifying parts of the lender that could be sold separately.
Reporting by Michelle Price; Editing by Christopher Cushing
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