The US Department of the Treasury has released a report
suggesting that the administration maintains the orderly
liquidation authority (OLA) as a precaution. But the government
agency says the future of the resolution regime created by
title II of the Dodd-Frank Act in 2010 should be
In line with previous issuances by the Treasury,
the report makes a number of recommendations about how the
OLA can be improved. The agency shares many of the same
concerns of the OLA’s critics, but - somewhat
surprisingly - does not go as far as to suggest that it should
be completely removed.
The OLA offers a process to liquidate large and complex
financial companies that are close to failing, acting as an
alternative to bankruptcy. The Federal Deposit Insurance
Corporation (FDIC) is appointed as a receiver to carry out
the liquidation and wind up the company.
In a statement...