Financial Stability Oversight Council (FSOC) Releases Third Annual Report April 25, 2013 at 04:53PM

Financial Stability Oversight Council (FSOC) Releases Third Annual Report

You are subscribed to Wall Street Reform for U.S. Department of the Treasury. This information has recently been updated, and is now available.

Financial Stability Oversight Council (FSOC) Releases Third Annual Report

WASHINGTON – The Financial Stability Oversight Council (Council) today unanimously approved its 2013 annual report, which was developed collaboratively by the members of the Council and their agencies and staff.  Under the Dodd-Frank Act, the Council must report annually to Congress on a range of issues, including the activities of the Council, significant financial market and regulatory developments, and potential emerging threats to the financial stability of the United States.  The report must also make recommendations to promote market discipline, maintain investor confidence, and enhance the integrity, efficiency, competitiveness, and stability of U.S. financial markets.

“Our work on financial reform is absolutely essential, as we work to modernize our regulatory framework and make our financial system more stable” said Treasury Secretary Jacob J. Lew.  “Members of this Council continue to make a great deal of progress in building a more resilient financial system, and the Council’s annual report informs the public about actions we have taken over the past year, developments in the financial system during that time, and the challenges ahead.”

In its third annual report, the Council’s findings and recommendations are organized around seven themes:

The vulnerability to runs in wholesale funding markets that can lead to destabilizing fire sales;

The housing finance system that continues to rely heavily on government and agency guarantees, while private mortgage activity remains muted;

Operational risks that can cause major disruptions to the financial system;

The reliance on reference interest rates, which recent investigations have demonstrated were manipulated, particularly in the case of the London Interbank Offered Rate (LIBOR);

The need for financial institutions and market participants to be resilient to interest rate risk;

Long-term fiscal imbalances, as the absence of bipartisan agreement on U.S. fiscal adjustment has raised questions about whether long-term fiscal problems may be resolved smoothly; and

The United States’ sensitivity to possible adverse developments in foreign economies.

In the report, the Council’s recommendations address the following topics:

Reforms to address structural vulnerabilities

Reforms of wholesale funding markets (money market funds, tri-party repo)

Housing finance reform

Reforms relating to reference rates

Heightened risk management and supervisory attention

Operational risk (cybersecurity, infrastructure)

Risk of prolonged period of low interest rates

Capital, liquidity, resolution

Progress on financial reform

At today’s meeting, the Council also approved the minutes from its April 4 meeting.  The report, as approved by the Council, and the meeting minutes will be available at http://www.fsoc.gov.

In attendance at the Council meeting were:

Jacob J. Lew, Treasury Secretary (Chairperson of the Council)

Ben Bernanke, Chairman of the Board of Governors of the Federal Reserve System

Richard Cordray, Director of the Consumer Financial Protection Bureau

Thomas Curry, Comptroller of the Currency

Edward DeMarco, Acting Director of the Federal Housing Finance Agency

Gary Gensler, Chairman of the Commodity Futures Trading Commission

Martin Gruenberg, Chairman of the Federal Deposit Insurance Corporation

Debbie Matz, Chairman of the National Credit Union Administration

Mary Jo White, Chair of the U.S. Securities and Exchange Commission

S. Roy Woodall, Jr., Independent Member with Insurance Expertise

Richard Berner, Director of the Office of Financial Research (non-voting member)

John Ducrest, Commissioner, Louisiana Office of Financial Institutions (non-voting member)

John Huff, Director, Missouri Department of Insurance, Financial Institutions and Professional Registration (non-voting member)

David Massey, Deputy Securities Administrator, North Carolina Department of the Secretary of State, Securities Division (non-voting member)

Michael T. McRaith, Director of the Federal Insurance Office (non-voting member)

For more information about each member agency’s financial reform implementation efforts, please follow the links below.

Board of Governors of the Federal Reserve System

Commodity Futures Trading Commission

Consumer Financial Protection Bureau

Federal Deposit Insurance Corporation

Federal Housing Finance Agency

National Credit Union Administration

Office of the Comptroller of the Currency

Securities and Exchange Commission

Treasury Department

###

Questions? Contact Us

Advertisements

Remarks by Treasury Secretary Jacob J. Lew at the Meeting of the Financial Stability Oversight Council (FSOC) April 25, 2013 at 04:53PM

Remarks by Treasury Secretary Jacob J. Lew at the Meeting of the Financial Stability Oversight Council (FSOC)

You are subscribed to Wall Street Reform for U.S. Department of the Treasury. This information has recently been updated, and is now available.

Remarks by Treasury Secretary Jacob J. Lew at the Meeting of the Financial Stability Oversight Council (FSOC)

As prepared for delivery

I would like to call the Financial Stability Oversight Council meeting back to order.

I want to start by welcoming Mary Jo White to the Council. I also want to thank Elisse Walter for her hard work over the past several months.

We are meeting to discuss the Council’s annual report. I will talk more about the report in a few moments, but first I would like to take note of why continuing our work on financial reform is absolutely essential.

As we gather together today, the financial system is much more resilient than it was five years ago, and members of this Council have made a great deal of progress in building a safer system, including much progress over the last year.

The Federal Reserve issued a new framework for the consolidated supervision of large financial institutions in December.

The Securities and Exchange Commission and the Commodity Futures Trading Commission continue to fill in the remaining pieces of a new comprehensive oversight framework for derivatives that will reduce risk and increase transparency.

The Consumer Financial Protection Bureau finalized new mortgage rules that provide additional protections for borrowers.

And the FDIC continued to implement the new framework for orderly liquidation authority.

So we have made important strides over the last year, and our financial system is stronger. But, as everyone here knows, much work still remains.

Let me turn now to what is happening today.

In an executive session, we discussed the Council’s continued analysis of nonbank financial companies. It is critically important that the Council take the time to get the analysis right, and we expect to vote on designations of an initial set of nonbank financial companies soon.

The Council’s 2013 annual report released today informs the public about actions the Council has taken over the past year, developments in the financial system during that time, and the challenges ahead.

Our annual report also lays out a number of recommendations to increase the stability of our financial system. I would like to briefly highlight some of the specific areas covered in the report.

A great deal of work remains to attract private capital to our nation’s housing finance system and bolster a housing market showing signs of recovery.

We need to strengthen markets that may be susceptible to destabilizing runs and fire sales.

We need to increase our vigilance to operational risks, whether from cyberattacks or from devastating acts of nature like we saw with Superstorm Sandy.

And we must work with our foreign counterparts to reform the governance and integrity of financial benchmark reference rates like LIBOR and to consider transitions toward alternative benchmarks.

In closing, I want to thank the members of the Council and their staffs for working tirelessly to put together this year’s report and make the financial system more resilient.

And now before we begin with the presentation, I want to give the members of the Council the opportunity to make opening remarks.

###

Questions? Contact Us

 

U.S. Department of the Treasury Civil Penalties Update April 25, 2013 at 02:17PM

U.S. Department of the Treasury Civil Penalties Update

OFAC Enforcement Information Update

You are subscribed to the Office of Foreign Assets Control’s Civil Penalties Information notification service at the U.S. Department of the Treasury. New information on OFAC Civil Penalties and Informal Settlements is now available.

For more information on this specific action, please visit our Recent Actions page at http://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/OFAC-Recent-Actions.aspx

Questions? Contact Us

U.S. Department of the Treasury Zimbabwe Sanctions Update April 24, 2013 at 10:31AM

U.S. Department of the Treasury Zimbabwe Sanctions Update

OFAC Sanctions Program Update

You are subscribed to Zimbabwe Sanctions for U.S. Department of the Treasury. This information has recently been updated, and is now available.

For more information on this specific action, please visit our Recent Actions page at http://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/OFAC-Recent-Actions.aspx

Questions? Contact Us

U.S. Department of the Treasury Syria Sanctions Update April 18, 2013 at 11:39AM

U.S. Department of the Treasury Syria Sanctions Update

OFAC Sanctions Program Update

You are subscribed to Syria Sanctions for U.S. Department of the Treasury. This information has recently been updated, and is now available.

For more information on this specific action, please visit our Recent Actions page at http://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/OFAC-Recent-Actions.aspx

Questions? Contact Us