The comment deadline on proposed changes to interpretive guidance on how nonbank firms are designated as risks to financial stability – and thus whether they must be subject to Federal Reserve supervision – has been pushed to July 27, according to a recent Federal Register notice.
The revisions would, for the first time, publicly outline how financial stability is identified and assessed and how risks are mitigated, according to the Financial Stability Oversight Council (FSOC).
The FSOC, with members from the federal financial regulatory agencies and chaired by the Treasury Secretary, would revise requirements established by the Trump administration.
Briefly, the proposal is said to enhance the FSOC’s ability to address financial stability risks by allowing the council to use all statutory authorities as appropriate to address risks to U.S. financial stability, regardless of the source of those risks; provide transparency to the public on how the FSOC performs its duties; and ensure a rigorous and transparent designation process by providing guidance for nonbank financial company designations guidance, including “significant two-way engagement with companies under review.”
Reg lookup: Authority To Require Supervision and Regulation of Certain Nonbank Financial Companies