,i #aafth ,,congress #b;d ,session ,h4 ,r4 #feja ,,in ,,the ,,house ,,of ,,representatives ,april #ad1 #bjbj,mr4 ,garca of ,illinois 7for himself1 ,ms4 ,porter1 ,mr4 ,grijalva1 ,ms4 ,schakowsky1 ,mr4 ,mc,govern1 ,ms4 ,norton1 and ,mr4 ,danny ,k4 ,davis of ,illinois7 introduced the following bill2 which was referred to the ,committee on ,financial ,services ,a ,,bill ,to strengthen the ,financial ,stability ,oversight ,council1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,systemic ,risk ,mitigation ,act of #bjbj4 #b4 ,member agency financial stability mandate 7a7 ,in general ,subtitle ,a of the ,financial ,stability ,act of #bjaj 7#ab ,u4,s4,c4 #ecba et seq47 is amended by adding at the end the following3 #abd4 ,member agency financial stability mandate ,each member agency shall have1 as part of the agency's mission1 a mandate to ensure the financial stability of the ,united ,states4 4 7b7 ,clerical amendment ,the table of contents for the ,dodd-,frank ,wall ,street ,reform and ,consumer ,protection ,act is amended by inserting after the item relating to section #abc the following3 ,sec4 #abd4 ,member agency financial stability mandate4 4 #c4 ,automatic designation of certain large nonbank financial companies 7a7 ,in general ,the ,financial ,stability ,act of #bjaj 7#ab ,u4,s4,c4 #ecaa et seq47 is amended by inserting after section #aac the following3 #aac;,a4 ,automatic designation of certain large nonbank financial companies 7a7 ,notice of automatic designation ,if a nonbank financial company meets the criteria described in subsection 7b71 the ,council shall notify such nonbank financial company that if1 on the date that is #i months after the date on which the notice is sent1 such nonbank financial company meets the criteria described in subsection 7b71 such nonbank financial company shall be deemed to be designated as systemically important4 7b7 ,criteria 7#a7 ,in general ,a nonbank financial company meets the criteria described in this subsection if such nonbank financial company satisfies-- 7,a7 the asset criteria in paragraph 7#b7 and the other criteria in paragraph 7#c72 or 7,b7 the criteria for an investment adviser that is registered with the ,commission under the ,investment ,advisers ,act of #aidj in paragraph 7#d74 7#b7 ,asset criteria ,a nonbank financial company satisfies the asset criteria in this paragraph if such nonbank financial company has-- 7,a7 in the case of a company that would be an investment company 7as defined in the ,investment ,company ,act of #aidj7 but for section #c7;c77#a7 or #c7;c77#g7 of that ,act1 #djj1jjj1jjj1jjj or more in gross notional exposure 7as defined in ,form ,,pf7 individually or in combination with any feeder funds1 parallel funds1 or dependent parallel managed accounts of the company2 or 7,b7 in the case of any nonbank financial company not described under subparagraph 7,a7 or paragraph 7#d71 #ej1jjj1jjj1jjj or more in consolidated assets4 7#c7 ,other criteria ,a nonbank financial company satisfies the criteria in this paragraph if such nonbank financial company has-- 7,a7 #cj1jjj1jjj1jjj or more in gross notional credit default swaps outstanding for which the nonbank financial company is the reference entity2 7,b7 #c1ejj1jjj1jjj or more of derivatives liabilities2 7,c7 #bj1jjj1jjj1jjj or more in total debt outstanding2 7,d7 a #ae-a1 or higher1 leverage ratio2 or 7,e7 a #aj percent1 or higher1 short-term debt ratio4 7#d7 ,investment adviser criteria ,with respect to an investment adviser that is registered with the ,commission under the ,investment ,advisers ,act of #aidj1 the criteria in this paragraph is that the investment adviser has more than #a1ejj1jjj1jjj1jjj in assets under management4 7c7 ,rescission of designation 7#a7 ,in general ,with respect to a nonbank financial company designated as systemically important under subsection 7a71 if the ,council determines that neither material financial distress at the nonbank financial company1 nor the nature1 scope1 size1 scale1 concentration1 interconnectedness1 or mix of the activities of the nonbank financial company1 could pose a threat to the financial stability of the ,united ,states1 the ,council may rescind such designation 7in this subsection referred to as a rescission determination7 for a period of #b years4 7#b7 ,authority to renew rescission ,the ,council may renew a rescission determination made under paragraph 7#a7 for an unlimited number of additional #b-year periods1 if the ,council makes a new determination that the nonbank financial company meets the criteria described under paragraph 7#a7 at the beginning of each such renewal4 7#c7 ,authority to review rescission ,the ,chairperson may review the status of a nonbank financial company with respect to a rescission determination before the end of a #b-year period described under paragraph 7#a7 or 7#b7 for any reason4 ,the ,chairperson shall notify the members of the ,council of such review and shall call a vote to renew the rescission determination within #g days of such notification4 ,if the ,council fails to renew the rescission determination1 the nonbank financial company shall be deemed once again to be designated as systemically important4 7d7 ,automatic rescission of designation ,if a nonbank financial company does not meet the criteria described in subsection 7b7 for #i consecutive months1 the ,council shall immediately1 and automatically rescind the designation of the nonbank financial company as systemically important4 7e7 ,application ,for purposes of this section1 the term nonbank financial company does not include a ,government-sponsored enterprise or an investment company registered with the ,commission under the ,investment ,company ,act of #aidj4 7f7 ,definition ,in this section and with respect to a nonbank financial company1 the term designated as systemically important means the nonbank financial company is subject to a determination under section #aac that the nonbank financial company shall be supervised by the ,board of ,governors and shall be subject to prudential standards1 in accordance with this title4 4 7b7 ,clerical amendment ,the table of contents for the ,dodd-,frank ,wall ,street ,reform and ,consumer ,protection ,act is amended by inserting after the item relating to section #aac the following3 ,sec4 #aac;,a4 ,automatic designation of certain large nonbank financial companies4 4 7c7 ,effective date ,this section and the amendments made by this section shall take effect not later than #i months after the date of the enactment of this ,act4 #d4 ,council regulation of systemically risky activities 7a7 ,in general ,subtitle ,a of the ,financial ,stability ,act of #bjaj 7#ab ,u4,s4,c4 #ecba et seq471 as amended by section #b1 is further amended by adding at the end the following3 #abe4 ,council regulation of systemically risky activities 7a7 ,authority of the ,council ,subject to subsection 7b71 the ,council shall issue such rules as may be required to regulate an activity or practice if the ,council determines that the conduct1 scope1 nature1 size1 scale1 concentration1 or interconnectedness of such activity or practice could create or increase the risk of significant liquidity1 credit1 or other problems spreading among bank holding companies and nonbank financial companies1 financial markets of the ,united ,states1 or low-income1 minority1 or under-served communities4 7b7 ,council delegation to the primary regulator ,with respect to an activity or practice that the council determines meets the standard outlined in subsection 7a7-- 7#a7 the ,council shall issue recommendations to the primary regulator for a rulemaking to address the risk posed by the activity1 and provide the primary regulator with a #ab-month period to issue a final rule to address such risk2 and 7#b7 if the primary regulator does not issue such a final rule within the period described under paragraph 7#a7 or the ,council determines that such final rule is insufficient to address the risk1 the ,council may-- 7,a7 terminate such final rule1 if applicable2 and 7,b7 issue a rule to address the risk4 7c7 ,backup authority of the ,council for member agency rulemakings ,with respect to any rulemaking required of a member agency by ,federal statute1 if the member agency does not issue the rule within the time frame required by such ,federal statute1 the ,council may issue such rule in place of the member agency4 7d7 ,primary regulator defined ,with respect to an activity1 the term primary regulator means-- 7#a7 one or more member agencies that the ,council determines are primarily responsible for regulating the activity2 or 7#b7 if the ,council cannot make a determination under paragraph 7#a71 the member agency that the ,council determines is the best choice to serve as the primary regulator with respect to such activity4 4 7b7 ,clerical amendment ,the table of contents for the ,dodd-,frank ,wall ,street ,reform and ,consumer ,protection ,act1 as amended by section #b1 is further amended by inserting after the item relating to section #abd the following3 ,sec4 #abe4 ,council regulation of systemically risky activities4 4 #e4 ,minimum staffing and funding levels for the ,council and the ,office of ,financial ,research 7a7 ,in general ,the ,financial ,stability ,act of #bjaj 7#ab ,u4,s4,c4 #ecaa et seq47 is amended-- 7#a7 in section #aah-- 7,a7 in the section heading1 by adding ,,and ,,staffing at the end2 7,b7 by striking ,any expenses and inserting the following3 7a7 ,expenses ,any expenses 2 7,c7 by inserting after ,office of ,financial ,research4 the following3 ,the ,office of ,financial ,research shall transfer a minimum of #ah1jjj1jjj to the ,council each year 7adjusted for inflation7 to pay for the costs of the ,council in carrying out the duties and responsibilities of the ,council42 and 7,d7 by adding at the end the following3 7b7 ,minimum staffing levels ,the ,council shall maintain a minimum staff of #ge employees4 2 7#b7 in section #aeb-- 7,a7 in subsection 7c71 by striking 1 in consultation with the ,chairperson12 and 7,b7 in subsection 7d77#a7-- 7i7 by striking 1 in consultation with the ,chairperson12 and 7ii7 by inserting before the period at the end the following3 1 except that the ,office shall maintain a minimum staff of #cjj employees2 7#c7 in section #aec7;b7-- 7,a7 in paragraph 7#b71 by striking and at the end2 7,b7 in paragraph 7#c71 by striking the period on the end and inserting 2 and2 and 7,c7 by adding at the end the following3 7#d7 require any member agency to produce such data and other information as the ,director may determine necessary to carry out the duties of the ,office4 2 and 7#d7 in section #aee7;d7-- 7,a7 by striking the ,secretary and inserting the ,office2 and 7,b7 by adding at the end the following3 ,the aggregate amount of assessments under this subsection with respect to a calendar year shall not be less than #afh1jjj1jjj 7adjusted for inflation744 7b7 ,clerical amendment ,the table of contents for the ,dodd-,frank ,wall ,street ,reform and ,consumer ,protection ,act is amended in the item relating to section #aah by adding at the end the following3 and staffing4 #f4 ,transparency in operations of the ,financial ,stability ,oversight ,council 7a7 ,meetings ,section #aaa7;e7 of the ,financial ,stability ,act of #bjaj 7#ab ,u4,s4,c4 #ecba7;e77 is amended-- 7#a7 in paragraph 7#a71 by striking not less frequently than quarterly4 and inserting not less frequently than twice each quarter4 ,at least #a of such quarterly meetings shall be open to the public42 and 7#b7 by adding at the end the following3 7#c7 ,transcripts ,the ,council shall publicly release transcripts of meetings held pursuant to paragraph 7#a7 not later than #e years after the date of such meeting4 4 7b7 ,testimony ,section #aab7;c7 of the ,financial ,stability ,act of #bjaj 7#ab ,u4,s4,c4 #ecbb7;c77 is amended-- 7#a7 in the subsection heading1 by striking by the ,chairperson2 and 7#b7 by inserting and each voting member of the ,council after ,the ,chairperson4 7c7 ,member agency statements ,section #aab of the ,financial ,stability ,act of #bjaj 7#ab ,u4,s4,c4 #ecbb7 is amended by adding at the end the following3 7e7 ,member agency statements ,after providing testimony pursuant to subsection 7c71 the head of each member agency shall submit to ,congress a signed statement-- 7#a7 affirming that the member agency is taking all reasonable steps to ensure financial stability and to mitigate systemic risk that would negatively affect the economy2 or 7#b7 detailing additional steps that the member agency should take to ensure financial stability and to mitigate systemic risk that would negatively affect the economy4 4 #g4 ,climate change subcommittee 7a7 ,in general ,subtitle ,a of the ,financial ,stability ,act of #bjaj 7#ab ,u4,s4,c4 #ecba et seq471 as amended by section #d1 is further amended by adding at the end the following3 #abf4 ,climate change subcommittee 7a7 ,in general ,the ,council shall establish a subcommittee of the ,council that shall support the ,council in identifying risks to1 and in responding to emerging threats to1 the stability of the ,united ,states financial system as a result of climate change4 7b7 ,responsibilities 7#a7 ,subcommittee ,the subcommittee established under subsection 7a7 shall1 not later than #a year after the date of enactment of this section1 and in consultation with the ,office of ,financial ,research1 submit to ,congress an assessment of the risk posed by climate change to the efficiency1 competitiveness1 and stability of the ,united ,states financial system as a whole4 7#b7 ,council ,for each year after the year in which the assessment required under paragraph 7#a7 is submitted1 the ,financial ,stability ,oversight ,council shall include in the annual report required under section #aab7;a77#b77,n7 an update to that assessment4 7c7 ,composition ,the subcommittee established under subsection 7a7 shall be composed of-- 7#a7 the ,chairman of the ,board of ,governors of the ,federal ,reserve ,system2 7#b7 the ,secretary of the ,treasury2 7#c7 the ,comptroller of the ,currency2 7#d7 the ,chairperson of the ,board of ,directors of the ,federal ,deposit ,insurance ,corporation2 7#e7 the ,chairman of the ,securities and ,exchange ,commission2 7#f7 the ,chairperson of the ,commodity ,futures ,trading ,commission2 and 7#g7 any other voting or nonvoting members that the ,council determines to be appropriate4 4 7b7 ,clerical amendment ,the table of contents for the ,dodd-,frank ,wall ,street ,reform and ,consumer ,protection ,act1 as amended by section #d1 is further amended by inserting after the item relating to section #abe the following3 ,sec4 #abf4 ,climate change subcommittee4 4