A failing or likely-to-fail (FOLTF) determination is made when a bank is no longer, or is expected shortly to cease being, viable under its supervisory authorisation or financial obligations. The assessment may be based on balance-sheet insolvency, an inability to meet payments when they become due, or the need for exceptional public financial assistance. A serious breach of the conditions attached to the bank’s authorisation may also justify the determination. At least one of these circumstances must already exist or be reasonably expected at the time of the assessment.
Passende Formel
Source: European Central Bank (ECB) (source). This glossary entry is an independently worded adaptation of the cited information.