You are here:HomeNews CenterInsurance News2016New President Could End FSOC

New President Could End FSOC

Market watchers say a Donald Trump administration could end the Financial Stability Oversight Council as a regulatory body and unwind the systemically important financial institution designation process that has exposed insurers to higher levels of prudential supervision, according to a report by A.M. Best...
November 22, 2016

Market watchers say a Donald Trump administration could end the Financial Stability Oversight Council (FSOC) as a regulatory body and unwind the systemically important financial institution (SIFI) designation process that has exposed insurers to higher levels of prudential supervision, according to a report by A.M. Best. The SIFI designation of nonbanks, like insurers, has been contentious from the start.


“FSOC as we know it will not survive the incoming administration and Congress, nor will the SIFI experiment,” says Justin Schardin, director of the Bipartisan Policy Institute Financial Regulatory Reform Initiative. “And since designating SIFIs is FSOC’s only significant power, it's not clear what else the council will do beyond the basics of providing a forum for its members to meet and monitor financial stability.”

The only two remaining insurance SIFIs are American International Group Inc. and Prudential Financial Inc. A third, MetLife Inc., shed its designation earlier this year through litigation. That court ruling has been appealed by the FSOC, however but any such appeal could be made moot with the appointment of a new U.S. Treasury Secretary.

Filed under: