Big banks beware: the G20 knows who you are. Today, its enforcement agency for financial stability released its official list of systemically important financial institutions. It includes 29 banks -- 17 based in Europe, eight based in the U.S., and four based in Asia. The full list is included below.
Being on the list could be a blessing or a curse -- depending on how you look at it. It sure won't feel good initially. These banks will be required to satisfy higher capital requirements than smaller banks. Each will also be forced to submit a plan for how it could be safely wound down should it fail.
But the good news for these institutions is that they are more likely to be bailed out. No wind-down plan can be full-proof. So should things go badly, a rescue may be unavoidable. Moreover, if a financial crisis sends several of these banks to the brink of collapse simultaneously, then bailouts would also likely follow.
Ultimately, whether or not these firms will be forced to fail will depend on if their failure can occur while avoiding a greater financial catastrophe and if politicians choose to be principled instead of practical.
Here's the full list, via the WSJ:
- Bank of America (US)
- Bank of New York Mellon (US)
- Citigroup (US)
- Goldman Sachs (US)
- J.P. Morgan (US)
- Morgan Stanley (US)
- State Street (US)
- Wells Fargo (US)
- BNP Paribas SA (France)
- Banque Populaire (France)
- Crédit Agricole SA (France)
- Société Générale SA (France)
- Barclays PLC (UK)
- HSBC Holdings PLC (UK)
- Lloyds Banking Group PLC (UK)
- Royal Bank of Scotland PLC (UK)
- Mitsubishi UFJ FG (Japan)
- Mizuho FG (Japan)
- Sumitomo Mitsui FG (Japan)
- Commerzbank AG (Germany)
- Deutsche Bank AG (Germany)
- UBS AG (Switzerland)
- Credit Suisse AG (Switzerland)
- Dexia SA (Belgium)
- Bank of China (China)
- Unicredit Group SA (Italy)
- ING Groep NV (Netherlands)
- Banco Santander SA (Spain)
- Nordea AB (Sweden)
