Government Declares Two Companies ’Too Big To Fail’
2013-07-10 0:00

By Emily Stephenson | Business Insider

The U.S. financial risk council on Tuesday said it has designated American International Group (AIG.N) and GE Capital (GE.N) as systemically risky, bringing them under stricter regulatory oversight.

The Financial Stability Oversight Council’s decision to name its first set of "systemically important" non-bank firms had been long expected by the financial services industry.

The designation shows that regulators believe the two companies are so big their failure could destabilize the financial system. The firms now come under regulation by the Federal Reserve and must meet capital and other requirements.

"These designations will help protect the financial system and broader economy from the types of risks that contributed to the financial crisis," said Treasury Secretary Jacob Lew, who also leads the oversight council.

The risk council, which includes the heads of other financial regulatory agencies, is a relatively new federal body that is testing its powers under the 2010 Dodd-Frank financial reform law for the first time.

After a number of non-bank firms struggled during the 2007-2009 financial crisis, Dodd-Frank gave the regulatory council the power to identify potentially risky non-bank firms and regulate them more like banks.

The first set of designations will not come as a surprise to the financial services industry. AIG in particular was expected to be tagged ’systemically important’ after it received a crisis-era bailout amid fears its size and interconnectedness could bring down the financial system.

[...]

Read the full article at: businessinsider.com



Related Articles
US Taxpayers Just Paid $780 Million To Fund The Latest Greece Bailout Tranche
The E.U. Cracks Up - Finns Against Portugal Euro Bailout
Nigel Farage: "Bombings, bailouts - what on earth are we doing?"
Spain to bailout their banks
Goldman Sachs pay out $111million in bonuses despite taking billions in bailout money
Who got the Bailout Money? Trillions Down the Drain
Greece Hires Goldman Sachs, Rothschild to Help Economy
Goldman Sachs Caught Manipulating Aluminum Prices, Stockpiles About 25% Of Global Inventories In Warehouses
Former AIG chief sues U.S. for $25 billion (Now that’s chutzpah!)
Fed in AIG rescue - $85B loan
Iceland President: Let Banks Go Bankrupt
Iceland’s Hörður Torfason – How to Beat the Banksters


Latest News from our Front Page

Boris Nemtsov, Putin Foe, Is Shot Dead in Shadow of Kremlin - A Staged Shooting?
2015-02-28 22:37
NY Times: Boris Nemtsov, Putin Foe, Is Shot Dead in Shadow of Kremlin Mr. Nemtsov, a former first deputy prime minister of Russia, was killed in central Moscow in the highest-profile assassination in Russia during the tenure of President Vladimir V. Putin. A Staged Shooting? ... Why does the dead body of fitness enthusiast Boris Nemtsov have a pot belly? The Anti-New York Times doesn't ...
Holocaust, Hate Speech and Were the Germans so Stupid?
2015-02-28 20:31
Description form YouTube: This is an updated version of the video which was taken down by YouTube following a spurious copyright-infringement claim. It addresses issues regarding claims that Zyklon B in liquid form gives off fumes at temperatures below 0º C. As the world approaches the brink of a new Middle East crisis this time involving Syria, clearly at the behind-the-scenes ...
The Jewish Roots of Leonard Nimoy and What the ‘Live Long and Prosper’ Hand Symbol Really Means
2015-02-28 0:20
Leonard Nimoy first saw what became the famous Vulcan salute, “live long and prosper,” as a child, long before “Star Trek” even existed. The placement of the hands comes from a childhood memory, of an Orthodox Jewish synagogue service in Boston. The man who would play Spock saw the gesture as part of a blessing, and it never left him. “Something ...
Baby born still INSIDE his amniotic sac is hailed a ‘medical miracle’ by doctors [Video]
2015-02-27 22:46
What an incredible miracle… Not only was the little boy three months early – he was born inside his amniotic sac. I’ve never heard of this happening before. If you look at the picture, you can see him clearly with his little arms and legs curled up. He was still being given oxygen by his mom until the sac was ...
California Infant Dies after 8 Vaccines, Family Gets Him Back from Hospital Cremated
2015-02-27 21:55
Parents in California are distraught after losing their infant son after being vaccinated. He died in his sleep and was taken to the hospital already deceased. Hospital staff ruled his death as sudden infant death syndrome. The couple was told an autopsy was required to be performed on their son. After returning home, waiting to get an update, they never received ...
More News »