Studies and Reports

The Financial Stability Oversight Council Annual Reports report on the activities of the Council, describe significant financial market and regulatory developments, analyze potential emerging threats, and make certain recommendations.

 

Report on Nonbank Mortgage Servicing

This report describes the growth of the nonbank mortgage servicing sector and the critical roles that nonbank mortgage servicers play in the mortgage market. It identifies certain key vulnerabilities that can impair servicers’ ability to carry out these critical functions and describes how these vulnerabilities can amplify shocks to the mortgage market and thereby pose risks to financial stability. The report includes recommendations to enhance the resilience of the nonbank mortgage servicing sector.

 

Report on Digital Asset Financial Stability Risks and Regulation – October, 2022

Fact Sheet on Digital Asset Financial Stability Risks and Regulation

This report was prepared under the direction of the Chairperson of the Financial Stability Oversight Council and in response to Executive Order 14067 (Ensuring Responsible Development of Digital Assets). This report outlines the financial stability risks and regulatory gaps posed by various types of digital assets and provides recommendations to address such risks.

 

Staff Progress Report on Interagency Efforts on Climate-related Financial Risk – July 2023

Factsheet on Progress in Addressing Climate-related Financial Risk – July 2022

Report on Climate-Related Financial Risk – October, 2021

Fact Sheet on Climate-Related Financial Risk 
This report was prepared under the direction of the Chairperson of the Financial Stability Oversight Council and in response to Executive Order 14030 (Climate-related Financial Risk).  This report identifies climate change as an emerging and increasing threat to U.S. financial stability and makes specific recommendations to financial regulators to measure, monitor, and address climate-related risks in their regulatory and supervisory activities.

 

Study of the Effects of Size and Complexity of Financial Institutions on Capital Market Efficiency and Economic Growth – March, 2016

This is a study of the effects of size and complexity of financial institutions on capital market efficiency and economic growth carried out at the direction of the Chairperson of the Financial Stability Oversight Council.  This study, issued pursuant to Section 123 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, updates the study issued in 2011.
 

Report to Congress on Study of a Contingent Capital Requirement for Certain Nonbank Financial Companies and Bank Holding Companies - July, 2012

Section 115 of the Dodd-Frank Act calls on the Chairperson of the Council to carry out a study of the economic impact of possible financial services regulatory limitations intended to reduce systemic risk and to make recommendations regarding the optimal structure of any limits considered. This report has been prepared in response to this mandate.
 

The Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act) required the Financial Stability Oversight Council (Council) to submit a report to Congress regarding a study on the feasibility, benefits, costs, and structure of a contingent capital requirement for nonbank financial companies supervised by the Board of Governors of the Federal Reserve System (Federal Reserve) and for large, interconnected bank holding companies (BHCs). This report addresses statutory mandates for the study through a review of the types and structures of contingent capital instruments and consideration of the potential benefits from and drawbacks of the use of contingent capital, including its potential to enhance the safety and soundness of nonbank financial companies supervised by the Federal Reserve and large, interconnected BHCs. In conclusion, the Council recommends that contingent capital instruments remain an area for continued private sector innovation, and encourages the Federal Reserve and other financial regulators to continue to study the advantages and disadvantages of including contingent capital and bail-in instruments in their regulatory capital frameworks.

 

Report to the Congress on Actions Taken in Response to the U.S. GAO's Report on National Credit Union Administration - June 11, 2012

The National Credit Union Authority Clarification Act (the Act) required the Comptroller General of the United States (GAO) to conduct a study of the National Credit Union Administration’s (NCUA) supervision of corporate credit unions and implementation of prompt corrective action (PCA). The Act further required that the Financial Stability Oversight Council submit a report to Congress on actions taken in response to the GAO report, including any recommendations issued to the NCUA under section 120 of the Dodd-Frank Act.

This report discusses the findings and recommendations of the GAO study, and outlines NCUA activities that relate to the GAO’s recommendations, including the NCUA’s: (1) continued evaluation of alternative approaches to PCA and the early identification of potentially troubled credit unions, and (2) maintenance of a robust process for the accurate and transparent valuation of the securities underlying the NCUA guaranteed notes backed by legacy assets of the failed corporate credit unions, and of the range of total potential corporate resolution costs.

 

Report to the Congress on Prompt Corrective Action - December 23, 2011

The Dodd-Frank Act required the Council to submit a report to Congress regarding the implementation of prompt corrective action (“PCA”) by the Federal banking agencies. More specifically, section 202(g)(4) of the Dodd-Frank Act requires the Council to issue a report on actions taken in response to the GAO study required by section 202(g)(1) of the Dodd-Frank Act. This report discusses the existing PCA framework and the findings and recommendations of the GAO study. It also highlights some lessons learned from the financial crisis and outlines actions taken that could affect PCA, as well as additional steps to modify the PCA framework that could be considered.

 

Secured Creditor Haircut Study - July 18, 2011

Section 215 of the Dodd-Frank Act required the Council to conduct a study evaluating the importance of maximizing United States taxpayer protections and promoting market discipline with respect to the treatment of fully secured creditors in the utilization of the orderly liquidation authority authorized by the Dodd-Frank Act.

 

The FSOC’s Study and Recommendations Regarding Implementation of the Volcker Rule - January 18, 2011

As mandated by the Dodd-Frank Act, the Council conducted a study on how best to implement Section 619 of the Act (commonly known as the “Volcker Rule”), which is designed to improve the safety of our nation’s banking system by prohibiting proprietary trading activities and certain private fund investments. The Council’s study puts forward recommendations designed to effectively and comprehensively implement the Volcker Rule in a manner that constrains risk-taking by, and promotes the safety and soundness of, banking entities.

 

The FSOC’s Report on the Concentration Limit on Large Financial Companies - January 18, 2011

Section 622 of the Dodd-Frank Act established a financial sector concentration limit that prohibits a financial company from merging or consolidating with, or acquiring, another company if the resulting company’s consolidated liabilities would exceed 10 percent of the aggregate consolidated liabilities of all financial companies. This concentration limit is intended, along with a number of other provisions in the Dodd-Frank Act, to promote financial stability and address the perception that large financial institutions are “too big to fail.” As required by the Dodd-Frank Act, the Council completed a study of the extent to which the concentration limit would affect: financial stability, moral hazard in the financial system, the efficiency and competitiveness of U.S. financial firms and financial markets, and the cost and availability of credit and other financial services to households and businesses in the United States. The study also contains the Council’s recommendations regarding modifications to the concentration limit to mitigate practical difficulties likely to arise in its administration and enforcement, without undermining its effectiveness in limiting excessive concentration among financial companies. These recommendations were issued for public comment on regulations.gov.  A docket folder summary can be found by searching for Docket ID: FSOC-2011-0002 and clicking on the Docket ID link from the search results.

 

Study of the Effects of Size and Complexity of Financial Institutions on Capital Market Efficiency and Economic Growth - January, 2011

This is a study of the effects of size and complexity of financial institutions on capital market efficiency and economic growth carried out at the direction of the Chairperson of the Financial Stability Oversight Council.  This study was issued pursuant to Section 123 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.