Berkshire faces U.S. scrutiny on systemic risk: Bloomberg

Warren Buffett, chairman and CEO of Berkshire Hathaway Inc./ Bloomberg

(Reuters) — The U.S. risk council is looking to determine whether Warren Buffett's Berkshire Hathaway Inc. could be systemically important, a tag that would subject it to stricter regulatory oversight, Bloomberg reported, citing two people familiar with the matter.

The U.S. Financial Stability Oversight Council's study of Berkshire may not mean the panel is inclined to designate the Omaha, Neb.-based company, Bloomberg said.

Berkshire was not immediately available to comment, while the U.S. Treasury declined to comment.

The council, led by Treasury Secretary Jacob Lew, is evaluating which nonbank financial companies could threaten financial stability if they were to fail, Bloomberg reported.

The council in July designated insurer American International Group Inc., GE Capital and Prudential Financial Inc. as systemically risky, thus bringing them under stricter regulatory oversight.

The risk council, which includes the heads of other financial regulatory agencies, is a relatively new federal body that is testing its powers under the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act.

After a number of nonbank firms struggled during the 2007-2009 financial crisis, Dodd-Frank gave the regulatory council the power to identify potentially risky nonbank firms and regulate them more like banks.