(Adds background about debate surrounding the riskiness of
By Sarah N. Lynch
WASHINGTON, March 28 The U.S. risk council will
host a May 19 public conference to assess risks asset managers
pose to financial markets, as the regulator faces industry
efforts to ward off more oversight of large operators.
The Financial Stability Oversight Council event at the
Treasury Department will feature panel discussions moderated by
U.S. regulatory staff, the department said on Friday.
The FSOC is seeking input from the industry and other
stakeholders, including academics and public interest groups,
the Treasury Department said in a statement.
The FSOC is chaired by Treasury Secretary Jack Lew and
comprises the heads of every major U.S. banking and financial
market regulatory agency.
The 2010 Dodd-Frank Wall Street reform law created the FSOC
and empowered it to police the marketplace for possible emerging
The FSOC can designate large financial firms as "systemic,"
a tag that carries capital requirements and additional
supervision by the Federal Reserve. The designation already
applies to two large insurance companies - American
International Group Inc and Prudential Financial Inc
, as well as GE Capital, a unit of General Electric Co
The FSOC is studying the asset management sector to
determine if large firms such as BlackRock Inc or
Fidelity could also pose risks.
In September, the Office of Financial Research, a unit
housed in Treasury, released a report that found asset
management activities could pose risks to the marketplace.
The report has been largely panned by the industry, which
claimed it contained flaws and fundamentally misunderstood how
asset managers operate.
The U.S. Securities and Exchange Commission, the industry's
primary regulator, also privately disagreed with the report and
put it up on its website for public comment. The posting
provided a forum for a deluge of criticism from the industry,
public interest groups and lawmakers.
Many firms and trade associations have called for the report
to be withdrawn, and urged FSOC not to use it as a basis for
determining whether asset managers should be designated.
(Reporting by Sarah N. Lynch; Editing by James Dalgleish and