(Bloomberg) — MetLife Inc. Chief Financial Officer John Hele said financial watchdogs failed to define what they mean by “systemic” before working on new rules for companies that are designated a risk to the financial system.
“Global regulators have really put the cart before the horse, the cart being capital and other standards,” Hele said Thursday in a conference held by the Institute of International Finance in New York. “The horse should be what is systemic.”
MetLife has sued the U.S. to overturn its designation as a non-bank systemically important financial institution. Chief Executive Officer Steve Kandarian has said that the financial system could endure MetLife’s failure, and that his industry is safer than banking, because it is harder for a client to pull money from an insurance contract than to withdraw from a bank at at time of crisis.
“We can all agree that the banking model, the traditional bank business, is systemic,” Hele said. “When you move beyond that, what is truly systemic? And that is where the thought, the research should really be happening.”