Building on its “key attributes” for orderly resolution without moral hazard, the FSB has built out a framework to ensure that critical operations continue without problematic interruption in the course of resolving a global systemically-important financial institution (G-SIFI).  Much in the guidance is likely to require G-SIFIs to restructure critical finance and operational functions, ring-fence many intra-group operational services, reprice these services in ways that may undermine G-SIFI efficiency, and revise the contractual terms with third parties to ensure that services continue under stress as long as the G-SIFI is current on its payments to them.  Importantly, this guidance does not address critical financial-market infrastructures (FMIs), which are G-SIFIs that provide payment, clearing, settlement, and similar services necessary to the financial market’s “plumbing.”  The FSB readily acknowledges that operational continuity at G-SIFIs that are not FMIs is often dependent on FMIs, but it nonetheless does not address it here.  Instead, it will do so at some future, unspecified date.

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