MFA sends letter to SEC supporting new FSOC guidance

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.