A group of major US banks are finalizing their so-called 'living wills' that will provide contingency plans to be used should they fail in the future.
Financiers including Bank of America, JP Morgan and Goldman Sachs are currently going through the last stages of drawing up these documents, which were made compulsory by the government in order to make it clear no firm is too big to fail.
Under the terms of this clause of the 2010 Dodd-Frank financial regulation overhaul, lenders holding in excess of $250 billion in nonbank assets are required to create official liquidation preparations.
These plans will then be analyzed by regulators to establish whether or not they are viable, while also markedly increasing the amount of power authorities hold over financial firms.
Sheila Bair, ex-chair of the Federal Deposit Insurance Corporation, told Bloomberg these rights should not go to waste.
"I think they should use the authority. How well they use it is going to be up to them," she added.
By Asim Shah