FSOC Meeting, October 1, 2010
Inaugural meeting of the Financial Stability Oversight Council.
- Discussion of systemic risk monitoring process
- Discussion of criteria for designating nonbank financial firms for supervision by the Board of Governors of the Federal Reserve System (Federal Reserve)
- Consideration of resolutions approving:
- The by-laws of the Council
- Publication of an Advanced Notice of Proposed Rulemaking (ANPR) regarding the criteria for designating nonbank financial firms for supervision by the Federal Reserve
- Publication of a request for comments regarding implementation of the prohibition on proprietary trading and sponsoring and investing in private equity and hedge funds; and (d)the transparency policy of the Council.
The Chairperson indicated that the first two items on the agenda would be discussed in the executive session and that the resolutions would be considered in the open session of the meeting
The member agencies of the Council share a collective desire to bring efficiency and transparency to the financial reform implementation process. The transparency policy approved today ensures that the Council will engage stakeholders in an open process based on consistent principles of transparency and accountability. The Council adopted a transparency policy that will include open meetings as appropriate, with provisions to close meetings in situations where the discussion includes market sensitive or confidential supervisory information.
The Council’s bylaws set forth the manner and procedures by which that body will be governed. They provide for a collaborative governance structure that promotes accountability for the work of the Council.
Advance Notice of Proposed Rulemaking Regarding Authority to Require Supervision and Regulation of Certain Nonbank Financial Companies
Section 113 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “DFA”) gives the Financial Stability Oversight Council (the “Council”) the authority to require that a nonbank financial company be supervised by the Board of Governors of the Federal Reserve System (“Board of Governors”) and subject to prudential standards if the Council determines that material financial distress at such a firm, or the nature, scope, size, scale, concentration, interconnectedness, or mix of the activities of the firm, could pose a threat to the financial stability of the United States. This advance notice of proposed rulemaking (ANPR) invites public comment on the criteria that should inform the Council’s designation of nonbank financial companies under the DFA. Twelve criteria are identified as requiring definition, and a request has been made for electronically submitted comments regarding 15 questions. Submission and public inspection of comments via www.regulations.gov. See FSOC Rulemaking Comment Letters for examples of public submissions.
Dodd-Frank Integrated Implementation Roadmap
This presentation provides a summary of key tasks that the FSOC will perform as part of implementing the Dodd-Frank Act.
The report includes analysis of issues by FOSC and its members agencies such as:
- Constraining risks to financial stability
- Resolution plans and orderly liquidation authority
- Consumer and investor protection
- Tansparency and accountability in financial markets
- Reforms to strengthen regulatory agencies
It also addresses time lines for various offices and issues including:
- Monitoring Systemic Risk - by FSOC and the Office of Financial Research
- Oversight of large, interconnected financial companies
- Systemic financial market utilities, and payment, clearing and settlement activities
- Constaining activities and size of financial institutions
- Resolution plans and Orderly Liquidation Authority
- Consumer Financial Protection Bureau
- Corporate governance and compensation
- OTC regulation
- Credit agencies
- Hedge fund advisor registration and oversight
- Agency changes, mergers