FSOC 2012 Annual Report and Designation of Financial Market Utilities (Dodd-Frank Study)

The FSOC Annual Report makes for a pretty good read, or at least skim for those topics relevant to the reader. The report covers a broad range of topics from implementation of regulation to potential new regulation, to areas of economic concern both in the United States and internationally. The heart of the report is Section 3, which contain's FSOC's annual recommendations. The recommendations relate to matter such as (i) money market mutual funds (which are reported to a hot political topic at the SEC), (ii) tri-party repo (a related item was in yesterday's news), and (iii) clearing house risk (the FSOC also designated eight systemically significant financial market utilities). There are also discussions of issues of newspaper interest (high frequency trading). (While one need not agree with everything in the report--for example, one may be somewhat or entirely dubious of the benefit provided by Dodd-Frank, there is a lot of ground covered in a thoughtful and straightforward manner).

In Appendix A of the Report (on page 145), FSOC designates eight entities as systemically important financial market utilities pursuant to Section 804 of the Dodd-Frank Act. These include clearing houses for currency, securities, futures and swaps.

Cross References: Dodd-Frank Title I, Title IV, Title VI, Title IX and Section 804; Dodd-Frank Studies table.

View study in full here (links externally to Dept. of Treasury website).