The Financial Stability Oversight Council (sometimes referred to as FSOC) convened its first “Official” meeting on October 1, 2010. There’s no lack of political maneuvering behind the scenes. Despite the congressional scuttlebutt, the Council appeared to have a focused, energized agenda. It passed resolutions during its meeting concerning a variety of important steps to fulfill its mandate of identifying threats to the stability of our nation’s financial system.
Subject matter resolutions adopted by the Council are noted below. Further information and pertinent documents about the below subjects may be located here. The council passed the following resolutions:
1. Organizational Bylaws for the Council – The bylaws appear standard but there are some open positions to be filled and a budget needs to be established.
2. Transparency Policy for the Council – A policy to engage stakeholders in an open process based on transparency and accountability. Meetings will be open to the press and public via a live web stream except when confidential or sensitive information will be discussed or disclosed. Meeting agenda and minutes (potentially redacted) will be made public.
3. Supervision and regulation of Nonbank Financial Companies – Advanced Notice of Proposed Rulemaking – A series of Questions to identify public comment about the designation of nonbank financial companies for heightened supervision. This is the first step in the Council’s process to bring certain nonbank financial companies under the supervision of the Federal Reserve Board. The basic factors for designation will be the Council’s determination that material financial distress of such a firm, or the nature, scope, size, scale, concentration, interconnectedness, or mix of the activities of the firm could pose a threat to the financed stability of the United States.
4. Implementation of the Volcker Rule – A notice and request for information concerning matters involving the “Volcker Rule”, the prohibition, on banks engaging in proprietary trading and from maintaining certain relationships with hedge funds and private equity funds. The Council is seeking comments on implementing these provisions. Comments are due November 5, 2010.
5. Integrated Implementation Roadmap – Coordinated timeline to implement Dodd-Frank by the Council and its member agencies. The roadmap provides a concise summary of the dates targeted for accomplishing certain objectives.
We will write as the Council moves forward.