MFA submitted a comment letter to FSOC in support of its proposal to revise the nonbank SIFI designation process.
The four points made in the letter are:
- MFA supports FSOC’s 2026 Proposed Guidance as a material improvement over the 2023 framework, restoring analytical discipline, transparency, and predictability to nonbank designations.
- MFA strongly support reestablishing an activities‑based approach as the starting point, with entity‑specific designation under Section 113 explicitly treated as a last resort.
- MFA supports a return to a structured, sequenced designation framework, with clearer escalation criteria and meaningful engagement with functional regulators.
- MFA welcomes the reinstatement of cost‑benefit analysis and a required assessment of the likelihood of material financial distress, applied through scenario‑based, mitigant‑aware analysis rather than worst‑case narratives.
MFA also recommended that Congress enact the FSOC Improvement Act can durably codify designation as a last resort and provide lasting market certainty.
