The Financial Stability Oversight Council, designed under the Dodd-Frank Act to identify risks to the stability of the financial system, unanimously voted Tuesday naming American International Group and GE Capital as systemically important institutions.
AIG and GE Capital are the first nonbanks to be named as systemically important by the FSOC.
"These designations will help protect the financial system and broader economy from the types of risks that contributed to the financial crisis." Treasury Secretary Jacob Lew, chairman of the 10-member interagency council, said in a press release of the companies.
AIG and GE Capital will face tough supervisory standards and are required to file a plan with regulators detailing how to safely unwind the company in case of failure. The council notified both nonbank institutions in June informing them they were identified as risky. After given a 30-day window to object, each company chose not to appeal.
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