Clifford Chance

National versus global approaches to financial crisis management

16 October 2019

In the immediate aftermath of the 2008 financial crisis, it was decided that the response needed to be global and that the concept of “too big to fail” no longer applied. However, in reality, policy makers have often taken national and protectionist approaches to crisis management, focusing on financial stability and the impact on taxpayers, rather than the broader global economy. Clifford Chance experts explore the reasons why.

The G20 mandated the FSB to take the lead on a raft of post-crisis measures. The most important of these were the Key Attributes of Effective Resolution Regimes for Financial Institutions (October 2011, updated 2014) and the Total Loss Absorbing Capacity Principles and Termsheet (November 2015). These documents aimed at creating a mechanism whereby a global institution could be resolved in an orderly manner at the level of its ultimate holding company (the “Single Point of Entry” model).

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