The Financial Stability Oversight Council (FSOC) is in the final stages of evaluating an initial set of nonbank financial companies for potential designation as SIFI, or systemically important financial institutions, according to remarks made today by Mary Miller, U.S. Treasury Under Secretary for Domestic Finance.
The hope is that the FSOC will vote up or down on the SIFI designations “in the next few months,” said Miller, who was speaking before the Annual Washington Conference of the Institute of International Bankers (IIB) this morning.
In a telephone interview last week with Bloomberg News, Sheila Bair called FSOC spineless in not designating nonbank SIFIs.
“It’s lack of will, it’s lack of courage, it’s lack of spine,” Bair said in a telephone interview Feb. 28 with Bloomberg News. “You can quote me on that and they’ll be angry with me, but I don’t care. This is outrageous.”
Bair, former chairman of the Federal Deposit Insurance Corp., now heads the Systemic Risk Council, a private watchdog group focused on regulatory issues.
The SIFI designation will subject the companies it applies to enhanced prudential standards and supervision by the Federal Reserve. Asset management businesses that make up a large part of some insurers may at some point come under these standards and have to reckon with them.