MetLife could be designated a systemically important financialinstitutions (SIFI) as early as next week, Bloomberg News saidtoday.

The Bloomberg article did not name a source. It said the votecould come during the next meeting of the Financial StabilityOversight Council (FSOC) July 31. However, the Bloomberg articlesaid the vote could be delayed briefly because the council hasn'tformally closed its review of the company.

John Nadel, an analyst at Sterne, Agee and Leach in New York,said he was not surprised and that institutional investors had beenexpecting it “for some time, it has been just a question ofwhen.”

John Calagna, a MetLife spokesman, declined comment.

If designated a SIFI, MetLife would be subjected to strictercapital, leverage and liquidity requirements as a result ofsupervision by the Federal Reserve Board as well as stateregulators. It would join American International Group andPrudential Financial as insurance SIFIs. General Electric CapitalCorp. is the only other non-bank SIFI.

However, Janet Yellen, chair of the Federal Reserve, has madeclear in congressional testimony that insurance companies aredifferent than banks, and that the Fed is in the process ofcreating metrics and adjusting its regulation to recognize thedifferences.

It could also demand stress testing for crisis scenarios, butstronger regulation of insurance SIFIs is unlikely to be unveileduntil next year.

Steve Kandarian, MetLife chairman and CEO, acknowledged that incomments to MetLife institutional investors June 10, when he saidit was too early to know exactly what a systemic designation wouldmean for his company. Regulators “could still come up with draftrules that we would find reasonable or come up with draft rulesthat maybe we wouldn't find as reasonable,” he said.

In designating MetLife at this time, the FSOC would be ignoringthe House Financial Services Committee (FSC). The panel reportedout two pieces of legislation that would establish at least amoratorium of up to one year on SIFI designations. The conservativeleadership of the House FSC arguments that the FSOC SIFIdesignation process “is not transparent.”

At a June 24 hearing of the FSC, Treasury Secretary Jacob Lewdisagreed. He testified that the FSOC process is transparent, andargued that House members and others who criticize it as “opaque”are “simply wrong.”

MetLife has been in Stage Three, the final stage of the FSOCdesignation process, for more than a year. The FSOC decided tore-evaluate its process for designating insurance companies asSIFIs after running into internal opposition to its ultimatedesignation of Prudential Financial as SIFI. These included RoyWoodall, the independent FSOC member with insurance expertise, aswell as

John Huff, the Missouri insurance commissioner and one of fivenon-voting members of the FSOC, and Ed DeMarco, acting head of theFederal Housing Finance Agency (FHFA). Pru was first designated aSIFI in late March of last year, but requested a hearing, asallowed under FSOC regulations. It was ultimately designated a SIFIOct. 31.

A two-thirds vote of the council is required to label a companysystemically important.

Kandarian has aggressively challenged a potential SIFIdesignation. As part of a Washington lobbying campaign last year,he met with analysts, members of the Chamber of Commerce andmembers of Congress. His argument: “We truly believe we're notsystemically important.”

MetLife executives have met more than 10 times with councilstaff members to argue it doesn't pose a systemic risk.