BaFin Publishes Additional Regulations to Make "Too Big to Fail" Institutions More Resistant to Failure in Crises

Summary: On April 25, 2014, the Bundesbank and BaFin published in their Circular 3/2014 additional regulations intended to contribute to the development of financial stability and the solution of the so-called “too big to fail” problem. Resolution planning and its integration into the structure of organizations should make systemically significant credit institutions and financial groups more resistant to failure in crisis situations by requiring them to deal in advance with the ways in which possible crisis situations could affect them. In addition, such institutions and groups are expected to adopt preventive measures of both an organizational and strategic nature that will allow them to act quickly and effectively at the appropriate time.