Money | Wed Mar 30, 2016 4:21pm EDT

U.S. judge strikes down MetLife designation of 'too big to fail'

WASHINGTON | BY LISA LAMBERT

Insurer MetLife Inc (MET.N) won a major regulatory and legal battle on Wednesday when a federal judge struck down the U.S. government's determination that it is "too big to fail."

MetLife had argued in court that the Financial Stability Oversight Council (FSOC), made up of the heads of the country's financial regulatory agencies, used a secretive and flawed process when in 2014 it designated the company as systemically important to the financial system.

The designation meant regulators believed a collapse of the insurer could devastate the U.S. financial system just as much as failure of a major bank, and triggered possible requirements for it to hold more capital and for stricter oversight.

"From the beginning, MetLife has said that its business model does not pose a threat to the financial stability of the United States," the company's chief executive, Steven Kandarian, said in a statement.

A representative for the U.S. Treasury said the agency disagreed with the decision and would vigorously defend the council’s designations process.

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