In 2016, financial regulators ordered significant changes in the “living wills” prepared by five large banks. According to an article in the Wall Street Journal, the wills as submitted didn’t “meet the legal standard laid out in the 2010 Dodd- Frank law, which requires that firms have credible plans to go through bankruptcy at no cost to taxpayers.”
a. Why did Congress decide to require large financial firms to have living wills?
b. Was this requirement in the Dodd-Frank Act related to changes the act made in Section 13(3) of the Federal Reserve Act? Briefly explain.