×
Newsmax TV & Webwww.newsmax.comFREE - In Google Play
VIEW
×
Newsmax TV & Webwww.newsmax.comFREE - On the App Store
VIEW
Tags: Wallison | MetLife | SIFI | FSOC

AEI's Wallison: Regulators Err in Naming MetLife as Systemically Important

By    |   Thursday, 11 September 2014 09:46 AM

Peter Wallison, a senior fellow at the American Enterprise Institute, isn't too impressed with the Financial Stability Oversight Council (FSOC)'s preliminary decision last week to name MetLife, the nation's largest life insurer, as a systemically important financial institution (SIFI).

"This means that the FSOC, established after the financial crisis by the 2010 Dodd-Frank law, believes the financial distress of MetLife could threaten the U.S. financial system," he writes in The Wall Street Journal.

"MetLife has a chance to appeal, but if the designation is finalized, the insurer will be subject to bank-like regulation from the Federal Reserve, though the Fed has never regulated an insurance company nor said how it would do so."

Editor's Note:
Seniors Scoop Up Unclaimed $20,500 Checks? (See if You qualify)

The FSOC itself has a major problem, Wallison says. "It embodies the underlying premise of Dodd-Frank: the financial crisis was caused by insufficient regulation."

In its rulings, the FSOC might "place the largest asset managers under the Fed's purview, giving the central bank an opportunity to determine what activities they finance. This could seriously impair the financing available to U.S. companies."

Satya Thallam, financial services policy director for American Action Forum, a center-right think tank, also takes issue with the FSOC.

"Although many analysts predicted the [SIFI] designation [for MetLife], the FSOC's opacity in the designation process makes it difficult to know when such a decision will take place or what factors would underlie it," he writes in a report provided to Moneynews.

"To add to the uncertainty, Dodd-Frank lays out (to some degree) what designation means for banks, but does not do so for nonbanks — in this case the nation's biggest life insurer."

Editor's Note: Seniors Scoop Up Unclaimed $20,500 Checks? (See if You qualify)

© 2021 Newsmax Finance. All rights reserved.


Finance
Peter Wallison, a senior fellow at the American Enterprise Institute, isn't too impressed with the Financial Stability Oversight Council (FSOC)'s preliminary decision last week to name MetLife, the nation's largest life insurer, as a systemically important financial institution (SIFI).
Wallison, MetLife, SIFI, FSOC
292
2014-46-11
Thursday, 11 September 2014 09:46 AM
Newsmax Media, Inc.
More Articles
Join the Newsmax Community
Read and Post Comments
Please review Community Guidelines before posting a comment.
 
TOP

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
America's News Page
© Newsmax Media, Inc.
All Rights Reserved
NEWSMAX.COM
America's News Page
© Newsmax Media, Inc.
All Rights Reserved