WASHINGTON — The Federal Reserve Board approved a rule Wednesday that outlines the criteria regulators will use to determine if a nonbank is systemically important.

Under the Dodd-Frank Act, the Financial Stability Oversight Council can subject a nonbank to Fed supervision if it determines its activities are financial in nature and pose a risk to the economy.

A firm is considered "engaged in financial activities" if 85% or more of its revenues or assets would be considered financial in nature under the Bank Holding Company Act, the rule says. Those activities include lending, investing on behalf of customers, providing financial advice and underwriting or servicing loans.

Moreover, the FSOC must consider other factors when determining if the company is systemically important, including the extent of its transactions and relationships with other banks and nonbanks, the rule says.

The final rule largely resembled the proposal issued last year, with a few exceptions. Unlike the proposal, the final rule says that engaging in physically settled derivatives transactions is not a financial activity. It takes effect May 6.

The rule paves the way for the FSOC to make its first designations of systemically important nonbanks soon, analysts said.

"We see this as removing a hurdle to the Financial Stability Oversight Council designating nonbank financial firms as systemically significant," wrote Jaret Seiberg, an analyst with Guggenheim Partners.

Seiberg said the most likely candidates for designation are: AIG, GE Financial, Prudential and MetLife, with BlackRock and Pimco also possibilities.

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