# Sifi designation `kaal:entity:sifi-designation` **Status.** derived This node is assembled mechanically from the 9 claims that carry the concept tag `sifi-designation`. It is a roster of what the corpus says under this term. It is **not** an adjudicated definition: no single statement here has been ruled canonical, and no first-appearance call has been made. Read the claims and judge for yourself. ## Every claim under this term 9 claims across 2 works, 2014 to 2016. **2014** - [2470008-011](https://wulfkaal.github.io/claims/2470008-011) [empirical/evidenced] -- International regulators agree on designation criteria but not on the unit of assessment: the FSB and IOSCO assess systemic importance at the fund level while the OFR would assess it at the asset manager level with all funds combined. > Although the proposed designation criteria are similar, the FSB and IOSCO emphasize the assessment of systemic importance at the fund-level, while the OFR suggests systemic assessment at the asset manager-level with all funds combined. Wulf A. Kaal, The Systemic Risk of Private Funds after the Dodd-Frank Act (2014). SSRN: https://ssrn.com/abstract=2470008 - [2470008-016](https://wulfkaal.github.io/claims/2470008-016) [mechanism/argued] -- The quantitative measures used in systemic risk assessment are not codified in statute, so the FSOC can alter its thresholds and its analysis through rulemaking. > the quantitative systemic risk assessment measures are not specifically codified and the FSOC can change thresholds and analysis via the rule making process Wulf A. Kaal, The Systemic Risk of Private Funds after the Dodd-Frank Act (2014). SSRN: https://ssrn.com/abstract=2470008 - [2470008-017](https://wulfkaal.github.io/claims/2470008-017) [condition/asserted] -- Commonly managed investment funds holding $50 billion or more in aggregate total consolidated assets can be designated systemically important, and following a similar investment strategy across those funds makes designation more likely. > Commonly managed investment funds that manage $50 billion or more in the aggregate of total consolidated assets could be designated a SIFI, particularly if such funds all follow a similar investment strategy. Wulf A. Kaal, The Systemic Risk of Private Funds after the Dodd-Frank Act (2014). SSRN: https://ssrn.com/abstract=2470008 - [2470008-018](https://wulfkaal.github.io/claims/2470008-018) [mechanism/asserted] -- Stage one of the FSOC's designation process is a mechanical screen: six quantitative thresholds filter out nonbank financial institutions unlikely to pose significant systemic risk before any institution specific or qualitative analysis begins. > In stage one, applying six quantitative thresholds, FSOC uses a mechanical screening process to eliminate those nonbank financial institutions from review that are unlikely to pose significant systemic risk and may not merit SIFI designation. Wulf A. Kaal, The Systemic Risk of Private Funds after the Dodd-Frank Act (2014). SSRN: https://ssrn.com/abstract=2470008 - [2470008-019](https://wulfkaal.github.io/claims/2470008-019) [mechanism/argued] -- SIFI designation changes the nature of regulation for a nonbank financial institution, subjecting it to substantial additional regulation and forcing it to change how it does business, which can in turn constrain its growth. > Designation as a systemically important financial institution (SIFI) would change the nature of the regulation for the respective nonbank financial institution and subject such entity to substantial additional regulations,149 requiring the respective entity to change the way it does business. Wulf A. Kaal, The Systemic Risk of Private Funds after the Dodd-Frank Act (2014). SSRN: https://ssrn.com/abstract=2470008 - [2470008-020](https://wulfkaal.github.io/claims/2470008-020) [mechanism/argued] -- The FSOC's three stage SIFI review process depends heavily on information that private fund investment advisers supply through Form PF. > FSOC's three-stage review process for SIFI designation153 depends heavily on the information provided by private fund investment advisers in Form PF. Wulf A. Kaal, The Systemic Risk of Private Funds after the Dodd-Frank Act (2014). SSRN: https://ssrn.com/abstract=2470008 - [2470008-034](https://wulfkaal.github.io/claims/2470008-034) [failure/argued] *(failure mode)* -- Because the FSOC uses RAUM related valuations directly and indirectly to set stage one thresholds, and because RAUM requires substantial filer interpretation, it is questionable whether the FSOC can use that Form PF data effectively and sustainably for systemic risk evaluations and SIFI designations. > it seems at least questionable if FSOC will be able to use the related Form PF data effectively and sustainably for its systemic risk evaluations and the designation of non-bank financial companies as systemically risky Wulf A. Kaal, The Systemic Risk of Private Funds after the Dodd-Frank Act (2014). SSRN: https://ssrn.com/abstract=2470008 **2016** - [2748096-027](https://wulfkaal.github.io/claims/2748096-027) [empirical/asserted] -- The FSOC's powers over hedge funds and other nonbank financial institutions are broad and unprecedented in U.S. financial regulation, including the power to subject hedge funds to extensive Federal Reserve supervision and to designate a fund systemically important on its own initiative by a two-thirds vote. > The FSOC's powers over hedge funds and other nonbank financial institutions are broad and unprecedented in U.S. financial regulation. The FSOC has the power to subject hedge funds to extensive supervision by the Federal Reserve. Wulf A. Kaal, Timothy A. Krause, Hedge Funds and Systemic Risk (2016). SSRN: https://ssrn.com/abstract=2748096 - [2748096-028](https://wulfkaal.github.io/claims/2748096-028) [failure/argued] *(failure mode)* -- The SIFI designation regime does not reach hedge funds in practice: because the asset threshold is set high, at $50 billion or more in aggregate total consolidated assets, hedge funds are unlikely to be designated as systemically important financial institutions. > However, hedge funds are unlikely to be designated as SIFIs because of the high threshold on AUM. Wulf A. Kaal, Timothy A. Krause, Hedge Funds and Systemic Risk (2016). SSRN: https://ssrn.com/abstract=2748096 ## Verify Every claim above resolves to a record carrying a verbatim source quote, the sha256 of the source PDF, and a preformatted citation. Nothing here asks to be taken on trust. curl -s https://wulfkaal.github.io/entities/sifi-designation.md | sha256sum **Canonical form.** This markdown file is the canonical hashed representation of this entity node. Its sha256 is the content hash.