2014 0310 - Letter - Sheila C. Bair to Senator Sherrod Brown (D-OH) - 6p
I question the argument that insurance organizations should have weaker bank/thrift holding company protections because their insurance policy holders can’t easily cash out if they make bad investments.
(p5) - Shelley Moore Kapito (R-WV) - (Unfortunately, the consequences of Dodd-Frank are not limited to access to credit.
Life insurance policyholders could potentially see increases in premiums if life insurers are forced to capital levels designed for a lending institution.
I will continue to work with both Chairman Hensarling and Chairman Neugebauer to resolve this unintended consequence.
(p46) - Barney Frank (D-MA) And I don’t think that—if that is your major—if that is all you do is asset management or sell life insurance, I don’t think you should be a SIFI. For one thing, I think they have enough other things to do, and there is no sign of their causing problems.
(p72) - Barney Frank (D-MA) -And, with AIG—and you go about the causes—the Federal Reserve—Mr. Bernanke came to us in September of 2008 and said, ‘‘I have just given $85 billion to AIG.’’
We have changed the law. He couldn’t do that again because they weren’t solvent.
House - Committee on Financial Services
2014 0909 - GOV (Senate) - Wall Street Reform: Assessing and Enhancing the Financial Regulatory System, Financial Regulatory System (CSPAN)
So, Senator, I guess I would draw a distinction between the creation of capital standards for traditional or current insurance activities, on the one hand, and an assessment of systemic risk on the other.
My own reading of the FSOC process with respect to Prudential and AIG is that there is not a lot of concern about the core insurance activities of those companies.
The concerns were with respect to some nontraditional insurance activities where runnability is more of a concern, and also with respect to things that are not insurance activities of any sort.
I think that is where the analysis would allow one to conclude there is systemic importance.
I personally do not think that the issue of whether there is systemic importance in traditional insurance activities has really been broached, and I am personally not sure we need to broach it.
I mean, my pretty strong presumption would be that there is not.
Senate - Committee on Banking, Housing and Urban Affairs
Mr. FITZPATRICK. Governor Tarullo also noted that AIG and Prudential were designated as systemic not because of their core insurance activities but due to what he called ‘‘nontraditional insurance activities,’’ where runnability is more of a concern, and also with respect to things that are not insurance activities of any sort.
Do you agree with Governor Tarullo that to justify designating an insurance company as an SIFI that one would have to find that the company engages in activities that are not traditional insurance activities and that do pose systemic risk?