Scribd Logo
Upload

Welcome to Scribd!

  • Living Will Letter Issued To JPMorgan Chase

    Uploaded by

    Editor
    1K views30 pages
    Federal Reserve Letter to JPMorgan Chase

    Original Title

    Living Will Letter Issued to JPMorgan Chase

    Copyright

    © © All Rights Reserved

    Available Formats

    PDF or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Report this Document
    Federal Reserve Letter to JPMorgan Chase

    Copyright:

    © All Rights Reserved
    Download as PDF or read online from Scribd
    Flag for inappropriate content
    1K views30 pages

    Living Will Letter Issued To JPMorgan Chase

    Uploaded by

    Editor
    Federal Reserve Letter to JPMorgan Chase

    Copyright:

    © All Rights Reserved
    Download as PDF or read online from Scribd
    Flag for inappropriate content
    of 30
    FDIC Apel 12, 2016 Me. James Dimon CChieman and Chief Executive Officer sPMorgan Chase & Co. 270 Park Avene, 48h Floor New York, New York. 10017-2014 Dear Mr. Dimon (On July 1,2015, the Board of Governors of the Federal Reserve System and the Federal Deposit Insurance Corporation (FDIC) (together, the Agencies) received the annual resolution plan submission 2015 Plan) of JPMorgan Chase & Co. (PMC) requited by section 165(4) of the Dodd-Frank Wall Steet Reform and Consumer Protection Act (Dodé-Frank Act), 12US. § 5365(), and the jointly sed implementing regulation, 12 CFR Pare 243 and 12 CFR Part 381 (the Resolution Plan Rule) The Agencies have reviewed th 2015 Plan aking into consideration section 165() ofthe Dodd-Frank Act, the Resolution Plan Rule the eter that the Agencies provided to JPMC in August 2014 (the 2014 Letter egarding JPMC's 2013 rsoltion plan submission, the communication the Agencies made to JPMC in February 2015 clarifying the 2014 Letter (the 2015 Communication), other guidance proved by the Agencies, and other supervisory information available tothe Agencies. In reviewing the 2015 Plan, the Agencies noted improvements over prior resolution plan submissions of JPMC, Nonetheless, the Agencies have jointly determined pursuant to section 165(4) ofthe Dode-Frank Act and section (6) of the Resolution Plan Rule thatthe 2015 Plan isnot credible or would nt facilitate an orderly resolution under the U.S. Bankruptey ‘Code. Section Il ofthis letter identifies the aspects ofthe 201 Plan thatthe Agencies jointly The 2015 Communication epi advised that rnsning actos required bythe Agencies in be 2014 Leter the 2015 Communication wo improve slaty geeraly re expect to be complete o ater than and JPMC ‘wholeste fundin + Since the 2015 Plan submission, JPMC has compliod withthe clean holding ‘company guidance from the 2014 Lette and 2015 Communication. In addition, the firm has improved its overall eaptal position, + JPMC has enhanced colter! management information stems, ening i 10 track he sources and uses of it secures clit A= trapped intemal and extra Shred sevice dependents (retusa ‘Scbricalinfasteture sjtemeinfelloctal property and ele) has locument eal ncaa services in eal agreement that contain ems incon ensure it thee Srvices woud continue in recolored has invented in elton specific managament information stems rand as adered 0 the Interation Derivatives Association 2075 Universal Resolution Stay Protocol Deficiencies and Remediation Notwithstanding the noted progress JPMC has made to dats, the Agencies jointly identified four specs ofthe 2015 Plan that are deficient. Laquiprry ‘The Agencies identified a defcieney regarding iquidity inthe 2015 Plan. As described below, JPMC does not have appropriate models and processes for estimating and maintaining sufficient Liquidity’ at, or readily available 0, material entities, or for estimating its liquidity needs to fund its material entities during the resolution peti, rial en” ad “el operations” refer to th eral ees, a ital operations dent in te Aesltion Lgl Adequacy nd Poston (LAP): TAA sot esa ee available to, material entities in resolution (RLAP model). ‘This is notable given JPMC’s: ligt poe in 2015 Plan, which ris onthe ems by shi substantial amount of ss ‘sam iuseion of is defeny inthe f’sRLAP model PMCs 2015 Planted on covey SII oF parent quit support being injected into various material ents, icing nS. woke ln, dsing th prod nme cig PMCs arty ee feng ings of iain, For campls ude the 2015 Pan, PMC mc plans vite :h 7 EE SRE epost A «I bach 08 oF the date ofthe 2015 Plan, If all ora portion of the funds deposited at the branch are not etued othe parent in a timely mannee—e-g, due to defensive ring feng EAI sc parent sey not have access to sufficient fund to support the recapitalization or funding needs of key lading ents, The sso ing-fencing is heightned by the stand-alone guidity isk profit of te I ranch, i thi partes that intent with he branch dicey, (0) EI, wi lends substantial amounts of ovemight fund directly othe branch, and (C) to h in stress could be exposed to subst outflows: (A) to 1 “Moet wrote ae of calito estimating he mt iii surf at cch ea nity an forthe fm in agreate aed on aston regarding vaio uid, hsql gd ese (HOLA), and Ee a BE no be mstcis sn EIT ‘nin Specifically, with espct to (C) above, the Financial interconnectedness between the HE onc ond IE prescnts noble challenges, The branch as commited to RN EA 2h: outa be craw up tothe fa AY amount or up (oI acison, there are substantia funding ows between the EL branch and nthe 2015 Plan. For example, the I beanch receives SIM of support fom EE. tile proving SE of Financial supporto A. The ‘magnitude and nature of this interconnectedness highligh he od forthe REAP model to have

    You might also like