Jan 17, 2013 — The Clearing House (TCH) is pleased to announce the release of (i) a report on TCH’s recently-concluded Title II OLA-Resolution Simulation exercise; and (ii) a white paper detailing how Title II and the single-point-of-entry approach can be used to resolve a large, complex financial institution. TCH’s Title II OLA-Resolution Symposium and Simulation Report details that a single-point-of-entry private sector recapitalization can resolve a large, complex financial institution in a manner that is orderly and which preserves financial stability and fully protects taxpayers from loss. The white paper provides a more detailed analysis of the workability and benefits of a Title II single-point-of-entry approach and argues that Title II provides regulators with an important safety valve to use in the event that a large, complex financial institution fails and ordinary resolution frameworks prove inadequate to protect financial stability. The paper asserts that Title II effectively ends the perceived “Too-Big-To-Fail” problem in the United States by requiring that shareholders lose their entire investment, creditors bear all the remaining losses, culpable management is terminated and no cost is imposed on the taxpayer.
