U.S. Fed seeks comments on systemically important non-bank firm designation proposals

WASHINGTON, Feb. 8 (Xinhua) -- The U.S. Federal Reserve on Tuesday requested public comments on the proposed rule that implemented two provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act related to the designation by the Financial Stability Oversight Council of "systemically important" non-bank financial companies for consolidated supervision.


The proposed rule first establishes the requirements for definition if a company is "predominantly engaged in financial activities." A company generally can be designated by the Council only if 85 percent or more of its revenues or assets are related to activities in financial nature, the U.S. central bank said in a statement.


Second, under the proposal, a firm would be considered " significant" if it has 50 billion U.S. dollars or more in total consolidated assets or had been designated by the Council as systemically important, according to the statement.


Public comments on the proposals must be submitted to the Fed by March 30 this year.


The Council, created last year, is designed to provide more coordinated oversight of the financial system among different financial watchdogs and identify threats to the nation's financial stability.


The Dodd-Frank Act, enacted last summer, requires U.S. financial regulators to contain risks to the financial system before they erupt into crises, and sets up a structure to collect data and identify emerging threats to the financial stability.
(Source:http://news.xinhuanet.com)