Donald Kohn
Donald Kohn
- ?-2008-? – FRB-NY – Federal Reserve Bank of New York – General Counsel and Executive Vice President of the Legal Group
- update: brief conversation with Jacob.
- Told him we were “very reluctant” to open up another 13-3 facility for an entity not even an investment bank.
- And that the market thought it was not only a liquidity problem but also a capital problem. He gave me the bridge to asset sales speech and then said he would get willumsted and call me back. I’m waiting.
- [Bonk: Jacob = Jacob Frenkel, AIG Vice Chairman]
- [Bonk: willumsted = Bob Willumstad, AIG CEO]
2008 0913 – email – Donald Kohn (FRB-NY) to Scott Alvarez (FRB) – JX-046 – 1p
⇒ Case 1:11-cv-00779 – V2 – 2014 0930 – Trial Volume 2 – Alvarez – 231p
- 2009 0305 – GOV (Senate) – American International Group: Examining What Went Wrong, Government Intervention, And Implications for Future Regulation, (CSPAN) Government Intervention and Regulation of AIG, Chris Dodd (D-CT) — [BonkNote]
- Testimony
- Eric Dinallo (NAIC / NYSID) – 8p
- 14:40 – Senator Shelby –
- Significant losses in AIG’s State-regulated life insurance companies also contributed to the company’s collapse. (p4)
- More than $17 billion in Federal assistance has been used to recapitalize the State-regulated insurance companies to ensure that they are able to pay their policy holders’ claims. (p5)
- 33:00 – Eric Dinallo (NY / NAIC) – Securities Lending didn’t have anything/much to do with AIG Collapse, run on aig life, [Bonk: Reputational Risk]
- Securities Lending, RMBS, Liquidity, [Bonk: C-3, 1980 SOA Paper, Run on AIG]
- Scott Polakoff – OTC
- (p25) – Donald KOHN (Vice Chairman, Board of Governors of the Federal Reserve System): Our authority under the Federal Reserve Act is to make loans.
- We thought it was a short-term liquidity situation- in mid-September, this is what we thought-and that if we could bridge this situation with liquidity, then the company could make the adjustments to keep itself a going concern.
- It turned out that the problems were deeper…
- Testimony
- 2021 06 – Brookings – Task Force on Financial Stability, by Glenn Hubbard, Donald Kohn, Ralph Koijen, Blythe Masters – 135p
- (p53) – The life insurance sector, while safe and quite boring in the past, has changed meaningfully during the past two decades from a financial stability perspective.
- The Global Financial Crisis showed that the life insurance industry has become fragile.
- This fragility was not limited to AIG. Some other companies received Troubled Asset Relief Program (TARP) support (for example, Hartford Financial Services Group received $3.4 billion in TARP equity).
- The Global Financial Crisis showed that the life insurance industry has become fragile.
- (p53) – Although the industry and its regulators responded to some extent to the problems that became evident in 2008, the fragility of the life insurance sector appears to persist.
- The first important factor is…
- Captive reinsurance, or “shadow insurance,” has also increased the opacity of the industry.
- Shadow insurance developed in response to regulatory changes in 2000 and 2003 for term and universal life insurance, known as “Regulations XXX and AXXX.”**
- These regulations tightened the regulatory capital requirements for these traditional products-for operating companies, which sell directly to consumers, but not for reinsurance companies.
- (p53) – The life insurance sector, while safe and quite boring in the past, has changed meaningfully during the past two decades from a financial stability perspective.
- (p3) – Co-chair: Donald Kohn
- Robert V. Roosa Chair in International Economics and a senior fellow in the Brookings Hutchins Center.
- Kohn was at the Federal Reserve Board from 1975 to 2010, the last several years as vice chair.
- He is a member of the FDIC’s Systemic Resolution Advisory Committee and a former member of the Financial Policy Committee of the Bank of England.