Why Attend
This one-week course, presented by PiB Knowledge Ltd, provides a comprehensive overview of conceptual and operational issues related to restructuring and resolution of weak banks. Among the topics discussed during the course are: • Identification and supervision of weak banks: common causes of banking problems and how to identify them, supervisory approaches for dealing with weak banks, and techniques for quantifying systemic banking problems (asset quality reviews and stress tests) • Crisis preparedness: building blocks of effective resolution regimes, guided by the Financial Stability Board’s Key Attributes of Effective Resolution Regimes; recovery and resolution planning; initiatives to test operational readiness; and the role of deposit insurance and depositor preference • Crisis containment: actions to contain emerging crises and re-establish public confidence, such as emergency liquidity support, asset and liability guarantees, and exceptional administrative measures to stop persistent liquidity outflows • Bank restructuring and resolution: early intervention measures; diagnosis, triage, and loss recognition; winding down nonviable banks; stabilization options to achieve continuity of systemically important functions; policy considerations and instruments for public capital support; governance of the restructuring process • Dealing with impaired assets: supervisory policies and strategies for the reduction of nonperforming loans; role of asset management companies
Course Objectives
- Upon completion of this course, participants should be able to:
- • Explain the building blocks of crisis preparedness and management
- • Identify weak banks and devise strategies for dealing with them
- • Assess their national bank resolution frameworks against international good practice
- • Design credible strategies for systemic bank restructuring and resolution
- • Identify and compare options for dealing with distressed assets
Target Audience
Origins of Banking Problems
- Macro-financial conditions
- Banking sector weaknesses
- Governance failures and insider abuse
- Role of prudential supervision
Problem Bank Supervision
- Guiding principles for dealing with weak banks
- On-site and off-site supervision techniques
- Progressive enforcement measures
- Prompt corrective action frameworks
- Early intervention tools, special administration
- Case Study
Effective resolution regimes
- FSB Key Attributes – why a new resolution standard?
- Components of effective resolution regimes
- Key issues and challenges
Closing a failed bank
- Advance preparation for intervention
- Function team approach to bank intervention
- Immediate actions at intervention
Closing a failed bank (cont’d)
- Selecting the resolution strategy – assisted transactions versus liquidated payouts
- Bidding procedures
- Public awareness and communications
- Common pitfalls and potential mitigants
- Case Study
After the closure – clean-up and recovery
- Receivership proceedings
- Asset management and disposition
- Reporting and oversight
- Transparency and ex post reviews
Crisis Preparedness
- Crisis preparedness frameworks
- Working groups, checklists, manuals, simulations
- Interagency coordination
- Capacity building
Resolving systemically important banks
- Tools for resolving systemically important banks
- Funding mechanisms
- Resolution strategies for D-SIBs Page 3
- Initiatives to improve the resolvability of D-SIBs
- Key challenges
- Case Study
Cross-border Resolution
- Experience in selected jurisdictions
- Post crisis reforms to foster cross-border coordination
- Mechanisms for information exchange and cross-border coordination
Dealing with Systemic Banking Crises
- What characterizes a systemic banking crisis?
- Guiding principles for managing systemic crises
- Policy options for crisis containment
- Public sector recapitalization programs
- Case Study
Case study final presentations
Closing remarks and delegate action plans
- Summary of the course
- Discussion of the observed trends and case studies
- Application of learning points in the delegates’ home organisations
- Preparation of action points