"Living Wills" of How to Unwind Big Banks Are Released Federal regulators released so-called living wills on Tuesday for nine of the nation's largest banks - blueprints for how they could be dismantled in the event of a collapse - but some analysts and other banking experts warned that they were still too big to fail without sending shock waves through the financial system. "The living wills are simply an exercise to make some people feel better," said Mike Mayo, an analyst with Crédit Agricole Securities. The living wills, released by the Federal Deposit Insurance Corporation and the Federal Reserve, outline plans prepared by the banks, including JPMorgan Chase, Bank of America and Citigroup, for their liquidation. These contingency plans represent one more bit of fallout from the 2008 financial crisis, when the bankruptcy of Lehman Brothers caused the entire banking system to freeze up, prompting government guarantees for lending and outright aid for many of the largest banks. The financial sector has bounced back for the most part since then, but public ire over the bailout remains strong. As of July 1, financial institutions with more than $250 billion in assets were required to submit living wills as part of the Dodd-Frank financial reform law. Under the law, more than 100 financial institutions will be required to submit such plans. While the wills aim to avert another government rescue of banks and dispel the notion that some institutions are too big to fail, they fall short, analysts cautioned. "These are vast institutions that can't be neatly unwound," Mr. Mayo said. When Lehman Brothers collapsed in 2008, it had roughly $639 billion in assets. JPMorgan Chase, the nation's largest bank, has $2.3 trillion in assets. Testifying before Congress last month about a multibillion-dollar trading blunder at his bank, Jamie Dimon, JPMorgan's chief, railed against the notion that the bank was too big to fail and emphasized that in the event of a crisis, the living wills would help stem larger economic damage. But analysts pointed out that the big banks were so intertwined that if one failed, it would probably take others with it, making it unlikely that enough healthy banks would remain to buy assets from the ailing ones. In its submission, UBS said that only large competitors would probably be able to buy its operations in the event of a crisis. "The theory of the living wills is that a failing institution could sell its subsidiaries to some other buyers," said Dwight C. Smith III, a lawyer specializing in bank regulatory issues for Morrison & Foerster. But the truth is that there wouldn't be an obvious buyer. Living wills are a good idea in theory, but their actual value in a real crisis would be limited, said Chris Kotowski, a longtime bank analyst with Oppenheimer. "When a financial institution fails, it usually happens suddenly and in an unpredictable way, and someone has to write a check," he said. Even in the wake of an overhaul of financial regulations by Washington, there still isn't a government entity with the combined authority and resources to manage the collapse of a leading financial institution without the event causing a shock to the economy, he said. "Nobody had the authority or resources to seize an institution like Lehman and plug the holes," he said. Mr. Kotowski suggested the industry should be forced to set up and pay for a fund, with tens of billions of dollars, to come to the rescue of a failing institution in the event of another crisis, much as the F.D.I.C. guarantees the accounts in banks that go under. This rescue fund would have to be considerably larger than the F.D.I.C."s fund, which banks themselves contribute to, and have broad legal powers. "The tragedy is that we weren't prepared for Lehman and four years later, we still aren't," he said. Federal authorities need a way to dismantle banks with debt holders, as well as stockholders, feeling the pain, Mr. Kotowski added. When Citigroup was rescued during the financial crisis, for example, shareholders suffered heavily but debt holders came out whole. Another deficiency in the living wills, some former regulators said, is that they were not prepared by the executives who would respond in the event of another financial crisis. "They are an exercise while things are fine, prepared by lawyers and not representative of what might happen," said Mark Williams, a former Federal Reserve bank examiner and a professor of finance at Boston University. It's false hope, unfortunately. Much of the information contained in the living wills has been available in other public filings, including quarterly filings with the Securities and Exchange Commission and annual reports. In some cases, banks gave an overview of their efforts to build capital and lower risk. Bank of America, for example, highlighted its sale of more than 20 noncore assets since the beginning of 2010, raising liquidity by more than $50 billion while also paring the bank's balance sheet. As part of the living wills, banks outline potential buyers in the event that they fail. Credit Suisse, for example, identified banks, hedge funds and securities firms as possible purchasers. Meanwhile, JPMorgan Chase said that its core businesses would be "highly attractive" to other firms. If regulators determine that banks" plans are not credible, they can force them to unload business units. The living wills are part of a larger debate about whether Dodd-Frank has made progress toward ending too big to fail. Mr. Williams, the former regulator, said that the wills are a step, but not a fundamental solution. "It is just a fire drill," he said.