Yellen Excerpt: Resolution Plans An Ongoing Process

     WASHINGTON (MNI)  - The following is a response of Federal Reserve Chairman

Janet Yellen to a question from a reporter at her press conference following

Wednesday's Federal Open Market Committee meeting.

Question:

     On the regulatory side, in your testimony to congress recently you spoke

positively about the senate bank regulatory reform bill. I was wondering if

there are beyond that bill, if there are tweaks to Dodd Frank that you think

might still be beneficial. 

     Then somewhat related, governor Powell said that there are currently no

U.S. banks that are too big to fail. I was wondering, do you agree with that

assessment? 

Yellen:

     Well, I mean, you know, I think I'm not familiar with every detail of the

bill, but I think the bill does address a wide range of issues that we have

highlighted in the past as being ones where perhaps additional flexibility to

tailor our supervisory requirements would be worthwhile. So I don't have

additional things on the Congressional list. 

     We continue to work seriously on resolution and the resolution plans, the

living wills and the structure of systemic firms, to ensure that it would be

possible to resolve a firm under the bankruptcy code would be the top choice of

methods or alternatively under the orderly liquidation authority. And I think

it's fair to say that over time, we have learned more ourselves and more clearly

detailed our expectations for the firms that file living wills, and the firms

themselves have made considerable progress in changing what they do, whether

it's adopting financial contracts that would facilitate a resolution, rather

than a disorderly unwinding of contracts, making sure that they are

appropriately dealing with shared services, so that key services would be able

to continue, governance arrangements, legal entity structures. The firms have

all made progress in adapting to our expectations of what would enable a

successful resolution. 

     So I think it's an ongoing process, and I believe we have made substantial

progress.

--MNI Washington Bureau; +1 202-371-2121; email: holly.stokes@marketnews.com

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