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US and UK strike cross-border deal on 'too big to fail' banks
Markets
by Sarah Miloudi on Dec 10, 2012 at 07:57
The US and UK will today strike a plan on how to tackle lenders deemed 'too big to fail'.
The Bank of England and Federal Deposit Insurance Corporation have compiled a paper which for the first time outlines a cross-border strategy on how to deal with failing banks.
The document will be released today, according to reports, and will detail how taxpayers will avoid the burden of future bank bailouts.
It also sets out a top down plan of how a failing institution will be arranged in order to protect the rest of the system.
Moreover, the document says that if the state incurs losses because of a failing bank it will be able to claw these back from the rest of the financial sector.
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