Yellen: Important to look at risks posed by huge asset managers like Blackrock

FILE PHOTO: A sign for BlackRock Inc hangs above their building in New York U.S., July 16, 2018. REUTERS/Lucas Jackson

(Reuters) – Treasury Secretary Janet Yellen said on Wednesday it is important to “look carefully” at systemic risks posed by large asset managers, including the world’s largest, Blackrock Inc, saying it might be appropriate to designate certain nonbanks as systemically important financial institutions.

Yellen’s remarks came in response to questions from Senator Elizabeth Warren, a long-time Wall Street critic, who demanded to know why Blackrock and other large asset managers had not been added to the list of designated institutions.

As Treasury secretary, Yellen chairs the Financial Stability Oversight Council which is charged with making such designations.

Yellen said it is appropriate to apply the SIFI designation to institutions whose failure would pose a systemic risk to the economy. She said FSOC has begun working on a program and the risk from asset managers is on the list of issues to be looked into.

Source: Read Full Article