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The Case for Rapid Resolution Plans

Author

Listed:
  • Richard J. Herring

    (The Wharton School, University of Pennsylvania, USA)

Abstract

During the peak of the financial crisis, the Group of Twenty met to determine how to repair the financial system and prevent a similar crisis from erupting in the future. They agreed to introduce a new kind of tool to counter the too big to fail problem: rapid resolution plans. Within the framework established by the Financial Stability Board, most high-income countries are attempting to implement this concept to enable them to resolve a large, troubled institution rapidly while preserving its systemically important functions, but without disrupting the rest of the financial system. This paper highlights the challenge that international corporate complexity poses for the effective implementation of rapid resolution policy.

Suggested Citation

  • Richard J. Herring, 2013. "The Case for Rapid Resolution Plans," Review of Economics & Finance, Better Advances Press, Canada, vol. 3, pages 1-17, May.
    • Handle: RePEc:bap:journl:130201
    as

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    File URL: http://www.bapress.ca/ref/v3-2/1923-7529-2013-02-01-17.pdf
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    References listed on IDEAS

    as
    1. Rong Qian & Carmen M. Reinhart & Kenneth S. Rogoff, 2011. "On Graduation from Default, Inflation and Banking Crises: Elusive or Illusion?," NBER Chapters, in: NBER Macroeconomics Annual 2010, volume 25, pages 1-36, National Bureau of Economic Research, Inc.
    2. Carola Frydman & Raven E. Saks, 2010. "Executive Compensation: A New View from a Long-Term Perspective, 1936--2005," The Review of Financial Studies, Society for Financial Studies, vol. 23(5), pages 2099-2138.
    3. Guttentag, Jack & Herring, Richard, 1984. "Credit Rationing and Financial Disorder," Journal of Finance, American Finance Association, vol. 39(5), pages 1359-1382, December.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Resolution; Too big to fail; Systemically important financial institutions; Corporate structure;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • G33 - Financial Economics - - Corporate Finance and Governance - - - Bankruptcy; Liquidation

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