Conditional separation The general idea of conditional separation from Avenue 1 was actually adopted into our second proposal, which says that a credible recovery and resolution plan for a bank may require, based on supervisory judgment, a more extensive separation of trading activities than laid out in our first proposal on mandatory separation.
Bail-in If a sufficiently simple and separate organizational structure is one precondition of successful recovery and resolution, the other is a sufficient amount of liabilities that can be bailed in. Our third proposal aims to complement the Commission’s plans on this front. We proposed that a layer of designated bail-in debt instruments could be considered.