WASHINGTON, July 6 (Reuters) - The largest Wall Street banks on Monday published detailed manuals of how to shut down their business during a crisis without the help of taxpayer money, a crucial step to prevent being broken up by regulators.
After the 2007-09 financial crisis, the banks were required to submit the so-called “living wills” each year to show how they would proceed though an ordinary bankruptcy during a crisis without quietly relying on government support.
But the Federal Reserve and the Federal Deposit Insurance Corporation last year said they were unhappy about the quality of the plans, urging the banks to improve them, or face tough sanctions including being broken up.
The 2010 Dodd-Frank Act gave the regulators the power to carve up the banks if they jointly deem the living wills “not credible,” though that is only the starting point of a lengthy procedure giving banks several chances to improve.
The banks are Bank of America, Bank of New York Mellon, Barclays, Citigroup, Credit Suisse , Deutsche Bank, Goldman Sachs, JPMorgan Chase, Morgan Stanley, State Street , UBS and Wells Fargo. (Reporting by Douwe Miedema; Editing by Alan Crosby)