We have invested considerable effort into addressing these shortcomings by increasing coordination between authorities and ensuring that national authorities also have the right incentives to cooperate in a crisis. For example: •  We have developed firm-specific cooperation agreements (CoAgs) to increase cross-border coordination and information-sharing between home and host authorities. •  We have set up Crisis Management Groups (CMGs) to agree resolution plans for globally systemically important banks. The UK is involved in CMGs for four G-SIBs as home authority and 14 as a host authority. Through CMGs we are making concrete changes in the set-up of firms that will help ensure that when faced with a crisis, authorities will stick to their ex-ante agreements. So-called ‘internal TLAC’ is a notable example – it enables losses to be passed up to the relevant part of the group. 11  6  See Financial Stability Board (2015). BIS central bankers’ speeches  •  In the European Union, resolution colleges have been established in accordance with the BRRD for cross-border firms that have operations in more than one Member State, and the UK expects to be involved in around 20 as home or host authority. Impact of reforms to date This multi-pronged programme of measures to address too big to fail is already having an effect. Ratings agencies have started to reduce their ‘government support’ uplifts for big banks. Spreads between senior and structurally subordinated debt of UK G-SIBs also suggests that resolution regimes are gaining credibility.

We have made very significant progress on a resolution regime for the 21st century. The powers, international standards and institutions are all in place. The authorities and the banking system have strong and common incentives to complete the implementation. It is in all our interests that we do so. 14  8  See Carney (2014). BIS central bankers’ speeches  References Afonso, G, Santos, J A, and Traina, J (2014) ‘Do 'Too-Big-To-Fail' Banks Take on More Risk?’, Federal Reserve Bank of New York Economic Policy Review 20(2). Bank of England (2015) ‘The Bank of England’s approach to setting a minimum requirement for own funds and eligible liabilities (MREL)’, Consultation on a proposed Statement of Policy, available at http://www.bankofengland.co.uk/financialstability/Documents/resolution/mrelconsultation2015 .pdf. Brooke M, Bush O, Edwards R, Ellis J, Francis B, Harimohan, R, Neiss, K and Siegert, C (2015) ‘Measuring the Macroeconomic Costs and Benefits of Higher UK Bank Capital Requirements’, Financial Stability Paper 35. Button, R, Knott, S, Macmanus, C and Willison, M (2015) ‘Desperate adventurers and men of straw: the failure of City of Glasgow Bank and its enduring impact on the UK banking system’, Bank of England Quarterly Bulletin Q1. Carney, M (2014) ‘The future of financial reform’, Monetary Authority of Singapore Lecture. Financial Stability Board (2015) ‘FSB issues final Total Loss-Absorbing Capacity standard for global systemically important banks’, Press release, available at http://www.fsb.org/2015/11/tlac-press-release/. Financial Stability Board (2015) ‘Assessing the economic costs and benefits of TLAC implementation’. Herring, R J and Carmassi, J (2014) ‘Complexity and systemic risk’, The Oxford Handbook of Banking, 77.