Understanding the Key Attributes
The Key Attributes set out twelve essential features (KAs 1 to 12) that should be part of the resolution regimes of all jurisdictions.
|KA 2||Resolution authority|
|KA 3||Resolution powers|
|KA 4||Set-off, netting, collateralisation, segregation of client assets|
|KA 6||Funding of firms in resolution|
|KA 7||Legal framework conditions for cross-border cooperation|
|KA 8||Crisis Management Groups (CMGs)|
|KA 9||Institution-specific cross-border cooperation agreements|
|KA 10||Resolvability assessments|
|KA 11||Recovery and resolution planning|
|KA 12||Access to information and information sharing|
Guidance on the Implementation of the Key Attributes
When the FSB adopted the Key Attributes in 2011 it was agreed to develop further guidance on the implementation of the Key Attributes, taking into account the need for implementation to accommodate different national legal systems and market environments and sector-specific considerations to promote effective and consistent implementation across jurisdictions.
The twelve Key Attributes are the umbrella standard for resolution regimes covering financial institutions of all types that could be systemic in failure, and the guidance does not form part of the Key Attributes standard. Where components of the guidance have been deemed important for purposes of assessing compliance with the Key Attributes, those components are explicitly reflected in the Key Attributes assessment methodology.
The guidance falls into two categories: (i) general guidance on the implementation of the Key Attributes; and (ii) sector-specific guidance. The sector-specific guidance recognises that not all Key Attributes are equally relevant for all sectors and that some require further explanation and interpretation, or some adaptation in order to be effectively implemented in a certain sector. The sector-specific guidance sets out how the Key Attributes should understood in a sector-specific context. It complements the Key Attributes, and the sector-specific guidance on individual KAs should be considered in conjunction with the KA to which it relates.
The FSB will continue its work to develop further guidance as needed to promote the effective and consistent implementation of the Key Attributes.
|KA 4||Temporary Stays on Early Termination Rights (October 2011) (Key Attributes, I-Annex 5)|
|KA 7, 12||Information sharing for Resolution Purposes (November 2014) (Key Attributes, I-Annex 1)|
|KA 8, 9, 11||Guidance on Cooperation and Information Sharing with Host Authorities of Jurisdictions where a G-SIFI has a Systemic Presence that are Not Represented on its CMG (November 2015)|
|KA 9||Institution-specific Cross-border Cooperation Agreements (October 2011) (Key Attributes, I-Annex 2)|
|KA 10||Resolvability Assessments (October 2011) (Key Attributes, I-Annex 3)|
|KA 11||Recovery and Resolution Plans (October 2011) (Key Attributes, I-Annex 4)|
|KA 3, 11||
Principles on Loss-absorbing and Recapitalisation Capacity of G-SIBs in Resolution and Total Loss-absorbing Capacity (TLAC) Term Sheet (November 2015) *The term sheet implements these principles in the form of a standard on the adequacy of TLAC
|KA 3, 11|
|KA 6||Guiding principles on the temporary funding needed to support the orderly resolution of a global systemically important bank (“G-SIB”) (August 2016)|
|KA 7||Principles for Cross-border Effectiveness of Resolution Actions (November 2015)|
|KA 11||Guidance on Recovery Triggers and Stress Scenarios (July 2013)|
|KA 11||Guidance on Identification of Critical Functions and Critical Shared Services (July 2013)|
|KA 11||Guidance on Developing Effective Resolution Strategies (July 2013)|
|KA 11||Guidance on Arrangements to Support Operational Continuity in Resolution (August 2016)|
|KA 1, 2, 3, 5, 6, 8, 9, 10, 11, 12||Resolution of Insurers (November 2014) (Key Attributes, II-Annex 2)|
|KA 6, 8, 9, 10, 11, 12||Developing Effective Resolution Strategies and Plans for Systemically Important Insurers (June 2016)|
Financial Market Infrastructures (FMIs) and FMI Participants
|All||Resolution of FMIs and FMI Participants (November 2014) (Key Attributes, II-Annex 1)|
|All||Guidance on Central Counterparty Resolution and Resolution Planning (July 2017)|
|KA 11||Guidance on Continuity of Access to Financial Market Infrastructures (FMIs) for a Firm in Resolution (July 2017)|
Financial Firms Holding Client Assets
|KA 1, 2, 3, 4, 6, 7, 10, 11, and 12||Protection of Client Assets in Resolution (November 2014) (Key Attributes, II-Annex 3)|
Assessment Methodology for the Key Attributes
The FSB published a methodology for assessing the implementation of the Key Attributes of Effective Resolution Regimes for Financial Institutions (Key Attributes) in the banking sector in October 2016.
The Key Attributes Assessment Methodology for the Banking Sector sets out essential criteria to guide the assessment of the compliance of a jurisdiction’s bank resolution frameworks with the Key Attributes. It is designed to promote consistent assessments across jurisdictions and also to provide guidance to jurisdictions when adopting or amending their bank resolution regimes to implement the Key Attributes.
It is the first step in implementing a modular approach that entails the development of self-contained and free-standing assessment methodologies for different types of institutions, for example banks, insurers and financial market infrastructures. A modular approach allows for the development of criteria that are tailored to the specific features of a particular sector and facilitates sector-specific assessment of the Key Attributes.