WASHINGTON, (Reuters) - The U.S. council of regulators on Wednesday chose eight clearinghouses as "systemically important," a label that will subject the financial institutions to tougher rules and more oversight.
The eight financial firms, which include Chicago Mercantile Exchange Inc. and The Depository Trust Company, will face heightened scrutiny from the Federal Reserve and their own regulator. They may also receive government backstops, and in emergency situations the Fed can decide whether to give the clearinghouses access to the discount window.
Treasury Secretary Timothy Geithner chairs the Financial Stability Oversight Council, which was set up to monitor risks in the financial system and prevent a repeat of the 2007-09 economic crisis.
The industry has been waiting for the council to start choosing which non-bank financial institutions, such as private equity firms and insurance companies, could pose a threat to the financial system. A "systemically important"
This article is only available in full to Compliance Complete
North America Subscribers who are logged in.
Please log in to see if you can view this content.