,,ib ,union ,calendar ,no4 #dej #aaeth ,,congress #b;d ,session ,h4 ,r4 #djfa ,report ,no4 #aae-eib ,,in ,,the ,,house ,,of ,,representatives ,october #ab1 #bjag ,mr4 ,ross 7for himself1 ,mr4 ,delaney1 ,mr4 ,luetkemeyer1 ,ms4 ,sinema1 ,mr4 ,mc,henry1 ,mr4 ,meeks1 ,mr4 ,huizenga1 ,mr4 ,david ,scott of ,georgia1 ,mr4 ,duffy1 ,mr4 ,foster1 ,mr4 ,barr1 ,mr4 ,sherman1 ,mrs4 ,wagner1 ,mr4 ,perlmutter1 ,mr4 ,royce of ,california1 ,mr4 ,himes1 ,mr4 ,lucas1 ,mr4 ,gottheimer1 ,mr4 ,stivers1 ,mr4 ,kihuen1 ,mr4 ,pittenger1 ,mrs4 ,beatty1 ,mr4 ,messer1 ,ms4 ,sewell of ,alabama1 ,mr4 ,tipton1 ,mr4 ,kilmer1 ,mr4 ,williams1 ,mr4 ,peters1 ,mr4 ,poliquin1 ,mr4 ,kind1 ,mrs4 ,love1 ,ms4 ,del,bene1 ,mr4 ,hill1 ,mr4 ,crdenas1 ,mr4 ,emmer1 ,mr4 ,quigley1 ,mr4 ,mooney of ,west ,virginia1 ,mr4 ,costa1 ,mr4 ,mac,arthur1 ,mr4 ,brendan ,f4 ,boyle of ,pennsylvania1 ,mr4 ,costello of ,pennsylvania1 ,mr4 ,thompson of ,california1 ,mr4 ,renacci1 ,miss ,rice of ,new ,york1 ,mr4 ,schweikert1 ,mr4 ,moulton1 ,mr4 ,sessions1 ,mr4 ,norcross1 ,mr4 ,tiberi1 and ,ms4 ,kuster of ,new ,hampshire7 introduced the following bill2 which was referred to the ,committee on ,financial ,services ,march #i1 #bjah;,additional sponsors3 ,mr4 ,aguilar1 ,mr4 ,hultgren1 ,mr4 ,connolly1 ,mr4 ,hollingsworth1 ,mr4 ,budd1 ,mr4 ,loudermilk1 ,ms4 ,blunt ,rochester1 and ,mr4 ,gonzalez of ,texas ,march #i1 #bjah ,committed to the ,committee of the ,whole ,house on the ,state of the ,union and ordered to be printed ,a ,,bill ,to amend the ,financial ,stability ,act of #bjaj to improve the transparency of the ,financial ,stability ,oversight ,council1 to improve the ,,sifi designation process1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,financial ,stability ,oversight ,council ,improvement ,act of #bjag4 #b4 ,,sifi designation process ,section #aac of the ,financial ,stability ,act of #bjaj 7#ab ,u4,s4,c4 #ecbc7 is amended-- 7#a7 in subsection 7a77#b7-- 7,a7 in subparagraph 7,j71 by striking and at the end2 7,b7 by redesignating subparagraph 7,k7 as subparagraph 7,l72 and 7,c7 by inserting after subparagraph 7,j7 the following3 7,k7 the appropriateness of the imposition of prudential standards as opposed to other forms of regulation to mitigate the identified risks2 and 2 7#b7 in subsection 7b77#b7-- 7,a7 in subparagraph 7,j71 by striking and at the end2 7,b7 by redesignating subparagraph 7,k7 as subparagraph 7,l72 7,c7 by inserting after subparagraph 7,j7 the following3 7,k7 the appropriateness of the imposition of prudential standards as opposed to other forms of regulation to mitigate the identified risks2 and 2 and 7#c7 by amending subsection 7d7 to read as follows3 7d7 ,reevaluation and ,rescission 7#a7 ,annual reevaluation ,not less frequently than annually1 the ,council shall reevaluate each determination made under subsections 7a7 and 7b7 with respect to a nonbank financial company supervised by the ,board of ,governors and shall-- 7,a7 provide written notice to the nonbank financial company being reevaluated and afford such company an opportunity to submit written materials1 within such time as the ,council determines to be appropriate 7but which shall be not less than #cj days after the date of receipt by the company of such notice71 to contest the determination1 including materials concerning whether1 in the company's view1 material financial distress at the company1 or the nature1 scope1 size1 scale1 concentration1 interconnectedness1 or mix of the activities of the company could pose a threat to the financial stability of the ,united ,states2 7,b7 provide an opportunity for the nonbank financial company to meet with the ,council to present the information described in subparagraph 7,a72 and 7,c7 if the ,council does not rescind the determination1 provide notice to the nonbank financial company1 its primary financial regulatory agency and the primary financial regulatory agency of any of the company's significant subsidiaries of the reasons for the ,council's decision1 which notice shall address with specificity how the ,council assessed the material factors presented by the company under subparagraphs 7,a7 and 7,b74 7#b7 ,periodic reevaluation 7,a7 ,review ,every #e years after the date of a final determination with respect to a nonbank financial company under subsection 7a7 or 7b71 as applicable1 the nonbank financial company may submit a written request to the ,council for a reevaluation of such determination4 ,upon receipt of such a request1 the ,council shall conduct a reevaluation of such determination and hold a vote on whether to rescind such determination4 7,b7 ,procedures ,upon receipt of a written request under paragraph 7,a71 the ,council shall fix a time 7not earlier than #cj days after the date of receipt of the request7 and place at which such company may appear1 personally or through counsel1 to-- 7i7 submit written materials 7which may include a plan to modify the company's business1 structure1 or operations1 which shall specify the length of the implementation period72 and 7ii7 provide oral testimony and oral argument before the members of the ,council4 7,c7 ,treatment of plan ,if the company submits a plan in accordance with subparagraph 7,b77i71 the ,council shall consider whether the plan1 if implemented1 would cause the company to no longer meet the standards for a final determination under subsection 7a7 or 7b71 as applicable4 ,the ,council shall provide the nonbank financial company an opportunity to revise the plan after consultation with the ,council4 7,d7 ,explanation for certain companies ,with respect to a reevaluation under this paragraph where the determination being reevaluated was made before the date of enactment of this paragraph1 the nonbank financial company may require the ,council1 as part of such reevaluation1 to explain with specificity the basis for such determination4 7#c7 ,rescission of determination 7,a7 ,in general ,if the ,council1 by a vote of not fewer than #b_/c of the voting members then serving1 including an affirmative vote by the ,chairperson1 determines under this subsection that a nonbank financial company no longer meets the standards for a final determination under subsection 7a7 or 7b71 as applicable1 the ,council shall rescind such determination4 7,b7 ,approval of company plan ,approval by the ,council of a plan submitted or revised in accordance with paragraph 7#b7 shall require a vote of not fewer than #b_/c of the voting members then serving1 including an affirmative vote by the ,chairperson4 ,if such plan is approved by the ,council1 the company shall implement the plan during the period identified in the plan1 except that the ,council1 in its sole discretion and upon request from the company1 may grant one or more extensions of the implementation period4 ,after the end of the implementation period1 including any extensions granted by the ,council1 the ,council shall proceed to a vote as described under subparagraph 7,a74 2 7#d7 by amending subsection 7e7 to read as follows3 7e7 ,requirements for proposed determination1 notice and opportunity for hearing1 and final determination 7#a7 ,notice of identification for initial evaluation and opportunity for voluntary submission ,upon identifying a nonbank financial company for comprehensive analysis of the potential for the nonbank company to pose a threat to the financial stability of the ,united ,states1 the ,council shall provide the nonbank financial company with-- 7,a7 written notice that explains with specificity the basis for so identifying the company1 a copy of which shall be provided to the company's primary financial regulatory agency2 7,b7 an opportunity to submit written materials for consideration by the ,council as part of the ,council's initial evaluation of the risk profile and characteristics of the company2 7,c7 an opportunity to meet with the ,council to discuss the ,council's analysis2 and 7,d7 a list of the public sources of information being considered by the ,council as part of such analysis4 7#b7 ,requirements before making a proposed determination ,before making a proposed determination with respect to a nonbank financial company under paragraph 7#c71 the ,council shall-- 7,a7 by a vote of not fewer than #b_/c of the voting members then serving1 including an affirmative vote by the ,chairperson1 approve a resolution that identifies with specificity any risks to the financial stability of the ,united ,states the ,council has identified relating to the nonbank financial company2 7,b7 with respect to nonbank financial company with a primary financial regulatory agency1 provide a copy of the resolution described under subparagraph 7,a7 to the primary financial regulatory agency and provide such agency with at least #ahj days from the receipt of the resolution to-- 7i7 consider the risks identified in the resolution2 and 7ii7 provide a written response to the ,council that includes its assessment of the risks identified and the degree to which they are or could be addressed by existing regulation and1 as appropriate1 issue proposed regulations or undertake other regulatory action to mitigate the identified risks2 7,c7 provide the nonbank financial company with written notice that the ,council-- 7i7 is considering whether to make a proposed determination with respect to the nonbank financial company under subsection 7a7 or 7b71 as applicable1 which notice explains with specificity the basis for the ,council's consideration1 including any aspects of the company's operations or activities that are a primary focus for the ,council2 or 7ii7 has determined not to subject the company to further review1 which action shall not preclude the ,council from issuing a notice to the company under subparagraph 7#a77;,a7 at a future time2 and 7,d7 in the case of a notice to the nonbank financial company under subparagraph 7,c77i71 provide the company with-- 7i7 an opportunity to meet with the ,council to discuss the ,council's analysis2 7ii7 an opportunity to submit written materials1 within such time as the ,council deems appropriate 7but not less than #cj days after the date of receipt by the company of the notice described under clause 7i771 to the ,council to inform the ,council's consideration of the nonbank financial company for a proposed determination1 including materials concerning the company's views as to whether it satisfies the standard for determination set forth in subsection 7a7 or 7b71 as applicable2 7iii7 an explanation of how any request by the ,council for information from the nonbank financial company relates to potential risks to the financial stability of the ,united ,states and the ,council's analysis of the company2 7iv7 written notice when the ,council deems its evidentiary record regarding such nonbank financial company to be complete2 and 7v7 an opportunity to meet with the members of the ,council4 7#c7 ,proposed determination 7,a7 ,voting ,the ,council may1 by a vote of not fewer than #b_/c of the voting members then serving1 including an affirmative vote by the ,chairperson1 propose to make a determination in accordance with the provisions of subsection 7a7 or 7b71 as applicable1 with respect to a nonbank financial company4 7,b7 ,deadline for making a proposed determination ,with respect to a nonbank financial company provided with a written notice under paragraph 7#b77;,c77i71 if the ,council does not provide the company with the written notice of a proposed determination described under paragraph 7#d7 within the #ahj-;day period following the date on which the ,council notifies the company under paragraph 7#b77;,c7 that the evidentiary record is complete1 the ,council may not make such a proposed determination with respect to such company unless the ,council repeats the procedures described under paragraph 7#b74 7,c7 ,review of actions of primary financial regulatory agency ,with respect to a nonbank financial company with a primary financial regulatory agency1 the ,council may not vote under subparagraph 7,a7 to make a proposed determination unless-- 7i7 the ,council first determines that any proposed regulations or other regulatory actions taken by the primary financial regulatory agency after receipt of the resolution described under paragraph 7#b77;,a7 are insufficient to mitigate the risks identified in the resolution2 7ii7 the primary financial regulatory agency has notified the ,council that the agency has no proposed regulations or other regulatory actions to mitigate the risks identified in the resolution2 or 7iii7 the period allowed by the ,council under paragraph 7#b77;,b7 has elapsed and the primary financial regulatory agency has taken no action in response to the resolution4 7#d7 ,notice of proposed determination ,the ,council shall-- 7,a7 provide to a nonbank financial company written notice of a proposed determination of the ,council1 including an explanation of the basis of the proposed determination of the ,council1 that a nonbank financial company shall be supervised by the ,board of ,governors and shall be subject to prudential standards in accordance with this title1 an explanation of the specific risks to the financial stability of the ,united ,states presented by the nonbank financial company1 and a detailed explanation of why existing regulations or other regulatory action by the company's primary financial regulatory agency1 if any1 is insufficient to mitigate such risk2 and 7,b7 provide the primary financial regulatory agency of the nonbank financial company a copy of the nonpublic written explanation of the ,council's proposed determination4 7#e7 ,hearing 7,a7 ,in general ,not later than #cj days after the date of receipt of any notice of a proposed determination under paragraph 7#d71 the nonbank financial company may request1 in writing1 an opportunity for a written or oral hearing before the ,council to contest the proposed determination1 including the opportunity to present a plan to modify the company's business1 structure1 or operations in order to mitigate the risks identified in the notice1 and which plan shall also include any steps the company expects to take during the implementation period to mitigate such risks4 7,b7 ,grant of hearing ,upon receipt of a timely request1 the ,council shall fix a time 7not earlier than #cj days after the date of receipt of the request7 and place at which such company may appear1 personally or through counsel1 to-- 7i7 submit written materials 7which may include a plan to modify the company's business1 structure1 or operations72 or 7ii7 provide oral testimony and oral argument to the members of the ,council4 7#f7 ,council consideration of company plan 7,a7 ,in general ,if a nonbank financial company submits a plan in accordance with paragraph 7#e71 the ,council shall1 prior to making a final determination-- 7i7 consider whether the plan1 if implemented1 would mitigate the risks identified in the notice under paragraph 7#d72 and 7ii7 provide the nonbank financial company an opportunity to revise the plan after consultation with the ,council4 7,b7 ,voting ,approval by the ,council of a plan submitted under paragraph 7#e7 or revised under subparagraph 7,a77ii7 shall require a vote of not fewer than #b_/c of the voting members then serving1 including an affirmative vote by the ,chairperson4 7,c7 ,implementation of approved plan ,with respect to a nonbank financial company's plan approved by the ,council under subparagraph 7,b71 the company shall have one year to implement the plan1 except that the ,council1 in its sole discretion and upon request from the nonbank financial company1 may grant one or more extensions of the implementation period4 7,d7 ,oversight of implementation 7i7 ,periodic reports ,the ,council1 acting through the ,office of ,financial ,research1 may require the submission of periodic reports from a nonbank financial company for the purpose of evaluating the company's progress in implementing a plan approved by the ,council under subparagraph 7,b74 7ii7 ,inspections ,the ,council may direct the primary financial regulatory agency of a nonbank financial company or its subsidiaries 7or1 if none1 the ,board of ,governors7 to inspect the company or its subsidiaries for the purpose of evaluating the implementation of the company's plan4 7,e7 ,authority to rescind approval 7i7 ,in general ,during the implementation period described under subparagraph 7,c71 including any extensions granted by the ,council1 the ,council shall retain the authority to rescind its approval of the plan if the ,council finds1 by a vote of not fewer than #b_/c of the voting members then serving1 including an affirmative vote by the ,chairperson1 that the company's implementation of the plan is no longer sufficient to mitigate or prevent the risks identified in the resolution described under paragraph 7#b77;,a74 7ii7 ,final determination vote ,the ,council may proceed to a vote on final determination under subsection 7a7 or 7b71 as applicable1 not earlier than #aj days after providing the nonbank financial company with written notice that the ,council has rescinded the approval of the company's plan pursuant to clause 7i74 7,f7 ,actions after implementation 7i7 ,evaluation of implementation ,after the end of the implementation period described under subparagraph 7,c71 including any extensions granted by the ,council1 the ,council shall consider whether the plan1 as implemented by the nonbank financial company1 adequately mitigates or prevents the risks identified in the resolution described under paragraph 7#b77;,a74 7ii7 ,voting ,if1 after performing an evaluation under clause 7i71 not fewer than #b_/c of the voting members of the ,council then serving1 including an affirmative vote by the ,chairperson1 determine that the plan1 as implemented1 adequately mitigates or prevents the identified risks1 the ,council shall not make a final determination under subsection 7a7 or 7b71 as applicable1 with respect to the nonbank financial company and shall notify the company of the ,council's decision to take no further action4 7#g7 ,final council decisions 7,a7 ,in general ,not later than #ij days after the date of a hearing under paragraph 7#e71 the ,council shall notify the nonbank financial company of-- 7i7 a final determination under subsection 7a7 or 7b71 as applicable2 7ii7 the ,council's approval of a plan submitted by the nonbank financial company under paragraph 7#e7 or revised under paragraph 7#f72 or 7iii7 the ,council's decision to take no further action with respect to the nonbank financial company4 7,b7 ,explanatory statement ,a final determination of the ,council1 under subsection 7a7 or 7b71 shall contain a statement of the basis for the decision of the ,council1 including the reasons why the ,council rejected any plan by the nonbank financial company submitted under paragraph 7#e7 or revised under paragraph 7#f74 7,c7 ,notice to primary financial regulatory agency ,in the case of a final determination under subsection 7a7 or 7b71 the ,council shall provide the primary financial regulatory agency of the nonbank financial company a copy of the nonpublic written explanation of the ,council's final determination4 2 7#e7 in subsection 7g71 strike before the ,council makes any final determination and insert from the outset of the ,council's consideration of the company1 including before the ,council makes any proposed or final determination2 and 7#f7 by adding at the end the following3 7j7 ,public disclosure requirement ,the ,council shall-- 7#a7 in each case where a nonbank financial company has been notified that it is subject to the ,council's review and the company has publicly disclosed such fact1 confirm that the nonbank financial company is subject to the ,council's review1 in response to a request from a third party2 7#b7 upon making a final determination1 publicly provide a written explanation of the basis for its decision with sufficient detail to provide the public with an understanding of the specific bases of the ,council's determination1 including any assumptions related thereof1 subject to the requirements of section #aab7;d77#e72 7#c7 include1 in the annual report required by section #aab1 the number of nonbank financial companies from the previous year subject to preliminary analysis1 further review1 and subject to a proposed or final determination2 and 7#d7 within #ij days after the enactment of this subsection1 publish information regarding its methodology for calculating any quantitative thresholds or other metrics used to identify nonbank financial companies for analysis by the ,council4 7k7 ,periodic assessment of the impact of designations 7#a7 ,assessment ,every five years after the date of enactment of this section1 the ,council shall-- 7,a7 conduct a study of the ,council's determinations that nonbank financial companies shall be supervised by the ,board of ,governors and shall be subject to prudential standards2 and 7,b7 comprehensively assess the impact of such determinations on the companies for which such determinations were made and the wider economy1 including whether such determinations are having the intended result of improving the financial stability of the ,united ,states4 7#b7 ,report ,not later than #ij days after completing a study required under paragraph 7#a71 the ,council shall issue a report to the ,congress that-- 7,a7 describes all findings and conclusions made by the ,council in carrying out such study2 and 7,b7 identifies whether any of the ,council's determinations should be rescinded or whether related regulations or regulatory guidance should be modified1 streamlined1 expanded1 or repealed4 4 #c4 ,rule of construction ,none of the amendments made by this ,act may be construed as limiting the ,financial ,stability ,oversight ,council's emergency powers under section #aac7;f7 of the ,financial ,stability ,act of #bjaj 7#ab ,u4,s4,c4 #ecbc7;f774 ,march #i1 #bjah ,committed to the ,committee of the ,whole ,house on the ,state of the ,union and ordered to be printed