Federal Reserve Chairman Ben Bernanke's characterization of an optional federal charter (OFC) as a “useful idea” received support today from Joe Plumeri, chairman and chief executive officer of Willis Group Holdings.
Mr. Bernanke–responding to a question from Rep. Ed Royce, R-Calif., during his semi-annual monetary policy report to Congress yesterday–said, “I think that it would be a useful idea to create a federal option for insurance companies–particularly for large, systemically critical insurance companies.”
He said that, “…in general, I believe that holding company level supervision of large, systemically critical institutions is very important,” adding, “We did not have effective holding company supervision in some of the cases where we have had problems. So I do believe an optional federal charter would be a direction worth giving serious consideration.”
Mr. Plumeri, responding to Mr. Bernanke's comments, said, “I support the position of Federal Reserve Chairman Bernanke, and I'm pleased he has raised the importance of this issue amid the current economic turmoil. We see the creation of an optional federal charter as a good thing if it leads to more consistent and unified regulation in the U.S.
“We believe the industry as a whole would benefit from having one set of rules to follow, instead of 50, especially if a new regulatory system embraces a principles-based approach to rule-making.”
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