Christine M. Cumming
Mon, October 25, 2010
Transatlantic Corporate Governance Dialogue
If such organizational complexity [of large financial institutions] imposes a high social cost by impeding recovery plans and resolution, providing incentives to reduce complexity may be warranted. For example, collateralization or capital requirements on intragroup exposures or parent guarantees could internalize for the firm some of those social costs. Alternatively, more direct supervisory requirements may be necessary for addressing the improvement of information systems or the separability and preservation of critical payment systems.
See Also: International Financial Regulatory Reform, Financial Regulatory Reform Source: http://www.newyorkfed.org/newsevents/speeches/2010/cum101025.html