The Clearing House Association, in coordination with ABA, FSR, and SIFMA, filed a letter with the Financial Stability Board in response to its proposal to impose a total loss absorbing capacity (TLAC) requirement on global systemically important banking groups (G-SIBs). The letter expresses the industry’s strong support for a TLAC requirement for G-SIBs to help ensure that these institutions can be resolved in an orderly way at creditor rather than taxpayer expense, bringing us one final step closer to ending “Too Big to Fail.”  The letter also highlights the importance of ensuring that any such requirement be empirically calibrated to achieve its express policy objective – which is to ensure that a G-SIB can absorb sufficient losses to permit its orderly resolution and recapitalization without taxpayer assistance. Empirical analysis performed by The Clearing House (and included in the comment letter) demonstrates that FSB’s proposed TLAC requirement of 16-20% of risk-weighted assets, plus the 2.5% capital conservation buffer and the G-SIB surcharge, is in excess of the loss absorbency necessary to prevent against even the most extreme historical or stress loss estimates.