The U.S. Treasury Department has recommended preserving powers created after the 2007-2009 financial crisis that allow regulators to step in and wind down a failing bank.

In a closely watched report published on Wednesday, the administration of Republican President Donald Trump favored keeping the "orderly liquidation authority" (OLA) created by the 2010 Dodd-Frank law, in a win for big banks that had been lobbying to keep it.

The OLA affords bank regulators special powers to wind down a complex financial institution in an orderly manner. The Treasury said it should be kept as "an emergency tool for use under only extraordinary circumstances."

The Treasury also urged Congress to expand the U.S. bankruptcy code to accommodate large financial institutions as a first resort in cases of failure.