Federal regulators in charge of labeling companies as systemically important financial institutions may be getting ready to remove Prudential Financial Inc.'s designation once and for all, according to Chairman, President and CEO John Strangfeld Jr.
Strangfeld said during a keynote speech at an S&P Global Ratings insurance conference that the SIFI tag was "inappropriately" applied in the years after the financial crisis. Fellow insurers MetLife Inc. and American International Group Inc. shed their SIFI labels in 2017, leaving Prudential as the last nonbank entity to be designated as such.
"I think the SIFI phenomena was inappropriately applied to us," Strangfeld said. "I didn't think we were systemic at the time, and I don't think we are now."
The CEO said that as the company undergoes its annual review before the Treasury Department's Financial Stability Oversight Council, the tone is a "favorable" one for the company. Strangfeld said that while de-designation by the panel is uncertain, he is optimistic the company will shake the tag soon.
"I think, over a reasonable time frame, our prospects are very good," Strangfeld said in a brief interview after his speech. "It's a very unnatural place for us to be in. We didn't take [Troubled Asset Relief Program]; we didn't have any behavioral issues. In fact, we were on offense during the financial crisis. We don't really fit the label."
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