WASHINGTON — The Financial Stability Oversight Council is close to identifying several nonbank financial companies as systemically risky after spending years ironing out how it would undertake the first-time effort.

The council, headed by Treasury Secretary Jacob Lew, will meet on Monday in closed session with 15 members of the interagency group, including Federal Reserve Board Chairman Ben Bernanke and Federal Deposit Insurance Corp. Chairman Martin Gruenberg. An agenda of the meeting has not been released, but it is widely expected the council will vote on designating at least three firms as systemically important financial institutions.

"The buzz is they're finally steeled to declare a firm systemically risky," said Karen Shaw Petrou, a managing partner at Federal Financial Analytics. "If it doesn't happen now, it will be concluded it never will."

Regulators are under pressure after missing several deadlines to move forward with a final designation, a responsibility given to the council by the Dodd-Frank Act. Regulators appear to have finally reached the point where they feel confident with proceeding with naming the first batch of nonbank financial firms.

Lew told lawmakers at a Senate Banking Committee hearing this month that there had been "substantial staff work going on between meetings."

"We're making progress on the nonbank designations," said Lew, who refrained from saying exactly when the council would make its designation ahead of a required vote. "I am hoping that we're going to be in a position to make a final determination in that area."

American International Group, GE Capital and Prudential Financial are under consideration for a systemic designation; MetLife could be considered by the council at a later date.

Even if the council formally designates those firms, it will not be able to release the names until it has informed the companies and given them the opportunity to decide whether they plan to protest the decision. Given the confidential nature of the process, the council has not revealed the names of the firms it has been evaluating individually over the last nine months. Representatives from GE Capital and Prudential declined to comment, while spokesmen from AIG and MetLife did not respond to requests for comment.

The insurance giant AIG has previously said it meets the thresholds set by the council to decide which firms require further review. Critics said the council has taken too long to arrive at its first designations, which they said damages the credibility of the process.

"For it to have taken three years to reach this uncertain stage of finalizing one of the most important planks of Dodd-Frank undermines the framework," Petrou said. "The cost of caution has been very high."

Not everyone is complaining that the council has taken its time in reaching this point, however. Several Republican lawmakers, including Sen. David Vitter, R-La., have implored the council to slow down the designating of firms, a process that has taken almost three years.

The council is also clearly trying to ensure that whatever designations it makes are legally binding and cannot be successfully challenged in court. Each firm has a 30-day window to object to the designation by regulators.

The council is then required to schedule a nonpublic hearing within 30 days, after which it has another 60 days to make a final decision. A designation requires a two-thirds majority vote by the council and approval from its chairman.

But observers expect that while it's likely any number of the companies named will protest the decision, their ability to successfully reverse it is slim.

"I don't think they're going to be successful in overturning the decision," said Gil Schwartz, a partner at Schwartz & Ballen and a former attorney for the Fed.

Once designated by the council, firms will face a tougher set of supervisory standards and be required to prepare and file a plan with regulators detailing how to safely unwind the company if it's on the brink of failure. It's unclear exactly what additional capital and liquidity requirements those nonbank firms would face under the Fed's supervision. MetLife and Prudential have sought to make the case to regulators that they should regulate life insurers differently than bank holding companies. Steve Kandarian, the chairman, president and chief executive of MetLife, has also preemptively argued that his firm shouldn't be designated at all.

"As an institution we cannot see how we pose a threat to the broader economy — in fact, we cannot see how a single firm would be brought down by its exposure to MetLife," said Kandarian, speaking at a U.S. Chamber of Commerce conference in April.

Regulators have said they will make determinations on a case-by-case basis.

The council outlined several criteria to make its initial identification during the initial stage of this process. To qualify, a nonbank firm must hold at least $50 billion of global consolidated assets. It must also meet at least one of the following thresholds: $20 billion in total debt outstanding, a minimum leverage ratio of 15 to 1, or $30 billion in gross notional credit-default swaps outstanding. Regulators can also weigh a number of other considerations, including whether it believes the company could pose a threat to financial stability.

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