In this context, adequate transition and grandfathering arrangements should be ensured. •  Second, legislative reform also needs to address the moral hazard stemming from systemically important financial institutions. In a resilient financial system it cannot and should not be taken for granted that authorities will always come to the rescue.
The focus of the ongoing work by the FSB in this regard is threefold: 1. It seeks to ensure that financial institutions, whatever their size and interconnectedness, should not cause undue distress to the functioning of the financial system and to the economy as a whole, if and when mismanagement drive them to bankruptcy.