MassMutual is hoping to hear “any day now” from the Federal Reserve Board on its application to deregister its trust company, MassMutual Trust Co., and therefore escape oversight by the Federal Reserve Board, a MassMutual executive said today.
Dennis Herchel, MassMutual assistant vice president, made his comments as a member of a panel discussion on regulatory issues held as part of the American Council of Life Insurers annual meeting in Washington, D.C., and in a brief interview afterward.
He made his comments a day after the comment period closed on a proposal by the Fed and other banking regulators that would subject thrifts owned by non-banks to consolidated regulation by the Fed as part of a provision of the Dodd-Frank financial services reform law.
Comments to the Fed on the proposal by insurance executives paint the proposal as a “sea change” for the insurance industry.
The comments to the Fed contend that the proposal would allow the Fed to impose “bank-centric” standards in regulating insurance companies which operate thrifts.
In a key letter, the chief financial officers of eight insurance companies, including Prudential, TIAA-CREF and the Principal, say that the proposal, if adopted, would require all insurance organizations subject to the Fed’s supervision, “regardless of size, to meet new minimum capital requirements beginning Jan. 1, 2013.”
In his comments, Herchel said that MassMutual has met all the requirements spelled out by the Fed to restructure the business so it won’t fall under consolidated Fed supervision.