FSOCked

29 March 2017 By Gina Chon Follow @GinaChon

The Financial Stability Oversight Council will focus more on coordinating the White House regulatory rollback than identifying risks. The post-crisis body may also force watchdogs to streamline enforcement actions. Shifting duties could cause regulators to miss emerging threats.

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Ten Republicans on the Senate Banking Committee sent a letter to Treasury Secretary Steven Mnuchin on March 28 urging him to review the Financial Stability Oversight Council’s process for designating non-banks as systemically important financial institutions. That label subjects them to tougher oversight by the Federal Reserve. Republicans on a House Financial Services subcommittee also criticized FSOC, which was created by the 2010 Dodd-Frank Act, during a hearing held on March 28.

President Donald Trump signed an executive order in February ordering Mnuchin to consult with FSOC to review regulations to ensure they foster economic growth and enable American companies to compete internationally. “We believe in appropriate regulation and in ensuring that taxpayers will never be at risk,” a Treasury spokeswoman said. “At the same time we have to ensure that banks can lend and provide liquidity which supports economic growth and job creation for the American people.”

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