WASHINGTON — Treasury Secretary Jack Lew cast doubt Tuesday on whether recent moves by large nonbank firms to sell assets were driven by a desire to shed their regulatory label of "systemically important."

The Financial Stability Oversight Council, which Lew chairs, makes designations of systemically important financial institutions. While the label opens those firms up to tougher regulation, the companies can attempt to get the designation removed.

But testifying before the House Financial Services Committee, Lew said he did not believe recent strategic moves by current SIFIs were motivated by dedesignation. For example, MetLife announced in January that it would split itself up through a sale, IPO or a spinoff. Last year General Electric announced a plan to sell most of the assets in GE Capital. On Monday the Federal Reserve Board approved the sale of GE Capital deposits to Goldman Sachs.

"I don't think the reason that those decisions were made [were] to get dedesignation," Lew said at the hearing. "I talked to the CEO of one of those firms who said expressly it was … for reasons of sticking to the core businesses of" technology and manufacturing.

Lew said the council was open to considering dedesignations through the panel's process of carrying out annual reviews of the SIFIs.

"There is an annual review and if a company sheds risk and comes in for review on an annual basis — that is the way to get dedesignated and we look forward to seeing applications that reflect that kind of change," he said.

Earlier in the month, MetLife appealed to the FSOC as part of its annual review, but the council voted not to rescind the designation.

Jaret Seiberg, a policy analyst at Guggenheim Securities, said in a research note that Lew's remarks focusing on the annual review process appear to rule out a midcycle request to be dedesignated. Firms that make changes would still have to wait for their annual review. That "means that a nonbank might remain a SIFI for many months even after it reduces its risk profile," Seiberg said.

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