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Press Release
February 08, 2011

Federal Reserve issues proposals related to
designation of systemically important nonbank
financial companies
For immediate release
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The Federal Reserve Board on Tuesday requested comment on a
proposed rule that implements 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
nonbank financial companies for consolidated supervision by the Board.
First, the proposed rule establishes the requirements for determining if a
company is "predominantly engaged in financial activities." Under the
Dodd-Frank Act, a company generally can be designated by the Council
only if 85 percent or more of the company's revenues or assets are
related to activities that have been determined to be financial in nature
under the Bank Holding Company Act.
Second, the proposed rule defines the terms "significant nonbank
financial company" and "significant bank holding company." Among the
factors the Council must consider in determining whether to designate a
nonbank financial company for supervision by the Board is the extent
and nature of the company's transactions and relationships with other
"significant" nonbank financial companies and "significant" bank holding
companies. Under the proposal, a firm would be considered "significant"
if it has $50 billion or more in total consolidated assets or had been
designated by the Council as systemically important.

Comments on the proposal must be submitted by March 30, 2011.
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Federal Register notice: HTML | 93 KB PDF

Last Update: February 08, 2011

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