August 20, 2014 / 7:09 PM / 5 years ago

U.S. risk council takes next step in MetLife systemic review

WASHINGTON (Reuters) - The top U.S. financial risk council has gathered enough evidence to decide whether insurer MetLife should be designated as a systemically important firm, a source familiar with the situation said.

The MetLife building is seen in New York, March 8, 2010. REUTERS/Shannon Stapleton

Closing the evidentiary record is the last formal step before the Financial Stability Oversight Council can vote on whether to designate MetLife with the tag.

The tag is applied to large firms whose failure could threaten financial markets, and it brings far greater scrutiny by financial regulators, as well as new capital requirements.

The risk council later on Wednesday said it had closed the evidentiary record on a “non-bank financial company,” but it does not name the firms in the process.

MetLife declined to comment.

The FSOC is chaired by Treasury Secretary Jack Lew and is comprised of the heads of other top financial regulatory agencies, including Federal Reserve Chair Janet Yellen and Securities and Exchange Commission Chair Mary Jo White.

The panel was created by the 2010 Dodd-Frank Wall Street reform law to monitor for potential emerging threats to market stability across regulatory agencies.

If FSOC members ultimately vote to propose Metlife for designation, the firm can still appeal before the panel and, eventually, before a U.S. court.

The FSOC has already designated as systemically important two other large insurers - Prudential Financial Inc and American International Group Inc - as well as General Electric Co’s GE Capital unit.

A potential vote on whether to designate Metlife has not been announced publicly.

Additional reporting by Sarah N. Lynch; Editing by Meredith Mazzilli, Eric Walsh and Leslie Adler

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