Prudential Fighting 'Too Big To Fail' Tag

[MDM4AU 337]

THE HILL

Major insurer fights label that critics equate with ‘too big to fail’

By Peter Schroeder - 07/07/13 06:00 AM ET

A major insurance company is battling a government-imposed title that Republicans contend would grace it with the “too big to fail” label.

Prudential Financial announced earlier this week that it was appealing a decision from federal financial regulators to designate it as a “systemically important financial institution,” or

SIFI.

The insurance company, one of three nonbanks to so far announce that regulators were trying to designate them, said it was appealing the decision, arguing it “does not meet the requirements of the SIFI designation.”

But in appealing the decision, Prudential is trying to scrap a label that Republicans argue offers a host of perks, including the implicit backing of the United States government.

While the Obama administration contends the Dodd-Frank financial reform law eliminates bailouts, GOP critics of the law argue it does the exact opposite, and makes bailouts the explicit law of the land.

But in appealing the decision, Prudential is trying to scrap a label that Republicans argue offers a host of perks, including the implicit backing of the United States government.

While the Obama administration contends the Dodd-Frank financial reform law eliminates bailouts, GOP critics of the law argue it does the exact opposite, and makes bailouts the explicit law of the land.

READ MORE HERE:

http://thehill.com/blogs/on-the-money/banking-financial-institutions/309387-prudential-fights-important-label?utm_source=buffer&utm_campaign=Buffer&utm_content=bufferd1057&utm_medium=twitter

[homersapien 11,812]

Does this pertain to the insurance part of their business or to their investment banking portion? (Assuming they have both)

It was my understanding that the reserve requirements associated with the insurance business makes them almost fail-proof. I'd like to learn more about this. Thanks for posting.