Government to Review Zions Bid to Shed 'Systemically Important' Tag
April 05 2018 - 9:01PM
Dow Jones News
By Lalita Clozel
WASHINGTON -- A financial regulatory body appears set to review
a bid by Zions Bancorp to escape the "systemically important" label
that triggers heightened supervisory standards.
The Financial Stability Oversight Council said Thursday that at
a meeting next week, it would discuss the "potential application"
of a firm under an exemption from a Dodd-Frank Act provision that
keeps large banks from evading the tougher supervision standards by
shedding their bank holding companies.
Zions said in November it planned to drop its bank holding
company, a move that allowed it to petition the council to release
it from the designation.
Three large nonbank firms have in recent years succeeded in
shedding their "systemically important" designations. In 2016, the
FSOC released General Electric Co. from the label after the company
wound down its financial arm. In September, the council released
American International Group Inc. from the designation, in a
decision backed by four new Trump appointees as well as former Fed
Chairwoman Janet Yellen. And in January, the FSOC dropped an appeal
against a 2016 ruling that overturned its designation of MetLife
Inc. as systemically important.
In the April 12 meeting, the FSOC is also slated to discuss
"potential amendments" to how it designates firms as systemically
important, following a November report by the Treasury Department
outlining a number of recommended changes.
The council will also consider "an update on the annual
re-evaluation of the designation of a nonbank financial company."
Insurer Prudential Financial Inc. is the only nonbank left bearing
the systemically important label.
Write to Lalita Clozel at lalita.clozel.@wsj.com
(END) Dow Jones Newswires
April 05, 2018 20:46 ET (00:46 GMT)
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