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2025-12-12 11:25:30
[Trump Administration Restructures Financial Stability Oversight Council, Shifting Focus to Deregulation and Growth] 1. U.S. Treasury Secretary Bessenter announced on Thursday that the Trump administration is undertaking reforms to the Financial Stability Oversight Council (FSOC), which is responsible for monitoring risks in the financial system. The aim is to shift its focus to promoting economic growth and examining the potential "undue burdens" of stringent financial rules. 2. Bessenter announced the reform plan on the social media platform X, followed by an FSOC meeting. He emphasized that the costs of regulation itself to economic growth constitute another risk, therefore the FSOC will focus on how to relax financial rules to reduce restrictions on economic activity. This plan aligns with the Trump administration's overall goal of stimulating economic growth through deregulation. 3. As a concrete step in the restructuring, Bessenter stated that the FSOC will establish several new specialized working groups. Among them, the Market Resilience Working Group will focus on examining U.S. Treasury bonds and other key financial markets, assessing whether existing rules "distort these key markets or create unnecessary costs." The Household Resilience Working Group will monitor potential pressures on household finances, including credit access and housing market dynamics. 4. In addition, the FSOC will also establish a dedicated working group to discuss artificial intelligence. The group will be responsible for studying how artificial intelligence (AI) technologies can enhance the resilience of the financial system, identifying new risks that AI may pose to financial stability, and exploring how regulators can leverage AI to improve their efficiency. The working group will also seek input from stakeholders on potential regulatory hurdles to the application of AI in the financial sector. 5. The committee brings together the heads of the major federal financial regulatory agencies, whose function is to identify and address widespread risks in the financial system. Under the new direction, the FSOC will collaborate with other regulatory agencies to review and identify existing rules that may "create undue burdens, negatively impact economic growth, and consequently undermine financial stability."
