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Oct 02, 2012

Shipshape Banks – Shipping Has A Lesson For Bank Resolution

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An article by London partner Barney Reynolds (Financial Institutions Advisory & Financial Regulatory), "Shipshape banks" was published in September by Financial World (a publication of the ifs School of Finance in association with the CSFI).

The article explores how regulators are still dealing with the paradox that their most important banks are “too big to fail” and yet too costly and risky to bail out. Reynolds suggests that shipping may provide a valuable model to prevent complete failure of key financial institutions and preserve value. He discusses the regime that allows shipowners to continue trading after calamitous events by establishing a fund covering the liability amount and all claims are only paid from this. He proposes a similar approach be adopted for the banking sector to offer more certainty.

View the full article “Shipshape Banks – Shipping Has A Lesson For Bank Resolution”

Authors and Contributors

Barnabas Reynolds

Partner

Financial Institutions Advisory & Financial Regulatory

+44 20 7655 5528

+44 20 7655 5528

London