US agencies find weakness in bankruptcy plans at 4 major banks

The Federal Deposit Insurance Corporation (FDIC) and Federal Reserve Board said Friday they found weakness in bankruptcy plans at four major American banks.

The joint review by the agencies examined submissions from eight of the largest and most complex banks in the US and found weaknesses in plans for Bank of America, Citigroup, Goldman Sachs and JPMorgan Chase.

Each weakness identified in the 2023 plans from the four banks is a "shortcoming," which is a weakness that raises questions about the feasibility of the plan, the agencies said in a statement.

The FDIC and the Fed said they provided feedback to each of the eight banks that identify areas for continued development of their resolution strategies and capabilities.

In addition, for the banks with an identified shortcoming, the feedback described specific weaknesses resulting in the shortcoming and remedial actions required by the agencies, they said.

The shortcomings are to be addressed in the next resolution plans due by July 1, 2025, according to the agencies.