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 Financial Stability Oversight Council Moves Forward to Minimize Risk in the Financial System


3/17/2011
FSOC Issues Proposed Rule on Designations of Financial Market Utilities for Heightened Supervision
 
WASHINGTON – The Financial Stability Oversight Council (FSOC) convened its fourth meeting today at the U.S. Department of the Treasury and approved each of the documents and resolutions put forward during today’s session. These include: a Notice of Proposed Rulemaking (NPR) regarding designations of financial market utilities for heightened supervision; an NPR on the FSOC’s FOIA Regulations; and the minutes of the FSOC’s previous meeting, held on January 18, 2011.   
 
NPR Regarding Designations of Financial Market Utilities for Heightened Supervision
 
Section 804 of the Dodd-Frank Act gives the FSOC the authority to identify and designate as systemically important a financial market utility (FMU) if the FSOC determines that its failure or disruption could create or increase the risk of significant liquidity or credit problems spreading among financial institutions or markets and thereby threaten the stability of the U.S. financial system.  An FMU designated by the FSOC as systemically important would become subject to the heightened prudential and supervisory provisions of Title VIII of the Dodd-Frank Act.
 
Through this proposed rule, the FSOC is seeking to gather additional information to inform the rule by which it will designate FMUs as systemically important. This is the second step in the FSOC’s rulemaking process for designating systemically important FMUs.  An advance notice of proposed rulemaking (ANPR) was discussed and approved for public comment at the FSOC’s November meeting.  The NPR will have a 60-day public comment period, with FSOC action on the final rule expected later this year.  The proposed rule, as passed by the FSOC, is available at www.treasury.gov/FSOC.
 
NPR on FSOC’s FOIA Regulations
 
Section 112 of the Dodd-Frank Act provides that the Freedom of Information Act (FOIA), including the exceptions thereunder, shall apply to any data or information submitted to the FSOC.  This NPR would implement the requirements of the FOIA as applied to the FSOC by setting forth procedures for requesting access to FSOC records. The proposed rule, as passed by the FSOC, is available at www.treasury.gov/FSOC.
 
Minutes from the Council’s January 18, 2011 Meeting  
 
The minutes, as passed by the FSOC, are available at www.treasury.gov/FSOC. 
 
In attendance at the FSOC meeting were:  
  • Tim Geithner, Treasury Secretary (Chairperson of the FSOC);
  • Sheila Bair, Chairman of the Federal Deposit Insurance Corporation;
  • Ben Bernanke, Chairman of the Board of Governors of the Federal Reserve System;
  • Edward DeMarco, Acting Director of the Federal Housing Finance Agency;
  • Gary Gensler, Chairman of the Commodity Futures Trading Commission;
  • Debbie Matz, Chairman of the National Credit Union Administration;
  • Mary Schapiro, Chairman of the U.S. Securities and Exchange Commission;
  • John Walsh, Acting Comptroller of the Currency;
  • William Haraf, Commissioner, California Department of Financial Institutions (non-voting member);
  • John Huff, Director, Missouri Department of Insurance, Financial Institutions, and Professional Registration (non-voting member); and
  • David Massey, Deputy Securities Administrator, North Carolina Department of the Secretary of State, Securities Division (non-voting member).
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