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The Financial Stability Oversight Council said
three reforms designed to help both companies and the general
public understand the process would go into effect immediately.
The panel added it may consider additional changes down the
road.
The FSOC is a panel of regulators chaired by U.S. Treasury
Secretary Jack Lew and is tasked with policing the market for
emerging risks. It has the power to designate large financial
firms as systemic, a tag that carries tougher capital rules and
oversight by the Federal Reserve.
The FSOC first pledged it would improve transparency in the
process last month, when staff launched a number of proposals at
a public meeting of the council.
The FSOC's proposals came in the wake of criticism from the
financial industry and the U.S. Congress accusing the FSOC of
being too shrouded in secrecy.
The FSOC said on Wednesday that under its new reforms, companies
will get more advanced notice on when they are being considered
for designation so they can provide regulators with more input.
Companies will also get a greater opportunity to weigh in when
the FSOC conducts its annual review into whether a company's
designation should remain in place.
In addition, the FSOC pledged to provide the general public more
details about how the designation process works.
"The changes adopted today represent an important step for the
Council that will increase the transparency of our designations
process and strengthen the Council overall," Lew said.
Since the FSOC was created by the 2010 Dodd-Frank law, it has
designated American International Group, Prudential Financial,
GE Capital and Metlife.
Metlife is currently challenging the FSOC's decision in a
federal court.
(Reporting by Sarah N. Lynch and Douwe Miedema; Editing by
Sandra Maler)
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U.S.
risk panel adopts reforms to improve transparency over
its operations
