Comments from Fed chairman in line with NAMIC See Regulation

 

Saturday, Mar 14,2009, 2:29:11 PM   Click:

WASHINGTON (March 11, 2009) - The National Association of Mutual Insurance Companies (NAMIC) welcomed the remarks made by Federal Reserve Chairman Ben S. Bernanke, the systemic risk. Addressing the Council on Foreign Relations this week, Bernanke called for the creation of an authority to control and monitor large, systemic risks to prevent future financial collapses.

Bernanke said that a financial stability "... could be strengthened by a more explicit approach to macro-financial regulation and supervision of the United States." A macro-prudential regulation, a Bernanke explained, would focus on "the signs of the [assets] bubble, more and more risks as the subprime mortgage market, or risk-sharing by the interconnected markets.

Bernanke suggested that Congress could allow a government agency like the Fed to monitor the extent of markets and financial institutions to "inhibit the accumulation of risks in the financial system and improve the resilience of the financial system to shocks negative.

"This view of systemic risk NAMIC mirrors the testimony presented to the House subcommittee on capital markets, insurance companies and sponsored by the government during a hearing on systemic risk held Thursday , March 5, "said Charles Chamness, NAMIC President and CEO.

In this testimony, NAMIC said that the potential risk of systemic regulation should focus on the market-oriented rather than institutions designated by regulatory agencies as "systemically important".

"NAMIC appreciated the comments of Fed chairman and agree with the need for a broad overview of the potential risks that are market driven," said Chamness. "Rather than focusing on legal matters or any basic facilities to the assessment of systemic risk, NAMIC encourage Congress to adopt legislation governing the order of regulation and systemic risk that has met with the emphasis on 'the impact of products or transactions used by financial services companies. "

For more information, contact

Nancy Grover
Director - Media Relations
(202) 628-1558 Tel
(202) 628-1601 Fax
ngrover@namic.org