In the European case, we need strict implementation of the EU directive on Banking Recovery and Resolution. This includes setting minimum requirements for own funds and eligible liabilities to be used in the resolution of a bank in troubles. It also includes formulating credible resolution plans for credit institutions. This is all about getting the incentives right.
No credit institution should be “too big to fail”. These are well-known areas of progress since the crisis, but we still have some way to go before the new and harmonised regulatory framework is fully in place. There are indeed still bumps on the road.