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TCH White Paper Finds Single-Point-of-Entry Can End “Too-Big-To-Fail”

By TCH Research

The Clearing House Association released a white paper detailing how Title II and the single-point-of-entry approach can be used to resolve a large, complex financial institution. The white paper provides a more detailed analysis of the workability and benefits of a Title II single-point-of-entry approach and argues that Title II provides regulators with an important safety valve to use in the event that a large, complex financial institution fails and ordinary resolution frameworks prove inadequate to protect financial stability. The paper asserts that Title II effectively ends the perceived “Too-Big-To-Fail” problem in the United States by requiring that shareholders lose their entire investment, creditors bear all the remaining losses, culpable management is terminated and no cost is imposed on the taxpayer.