In a June 3, 2013 closed-door meeting, the FSOC proposed to designate three financial services companies as the first systemically significant nonbank financial institutions (“nonbank SIFIs”) under section 113 of the Dodd- Frank Act. The FSOC decision did not identify specific firms, but AIG, Prudential Financial and GE Capital each publicly confirmed its proposed nonbank SIFI status.
If these proposed designations become final, the three firms will be subjected to stringent Federal Reserve Board oversight and supervision, as well as to capital and other regulatory requirements. Moreover, should a nonbank SIFI fail or be in danger of failing, it may become subject to the Dodd-Frank Act’s orderly liquidation authority.
Click here to read our alert about FSOC’s proposed designations.