Under Dodd-Frank, bank-holding companies with more than $50 billion in assets, which include JPMorgan Chase & Co., Citigroup Inc. and Goldman Sachs Group Inc., are automatically considered systemically important. One of the tasks of the oversight council is to determine which non-banks, such as private-equity firms, money managers, hedge funds or insurers, need the same designation and will be subject to additional oversight by the Fed.

The FSOC is also working without a full lineup of 10 voting members because Obama administration nominees haven't been confirmed by the Senate. The Office of Financial Research, a data-collection and research unit created by Dodd-Frank to help the council, doesn't have a director and as of last week had only 24 of the 60 employees scheduled to be on board by September.

The research office will gather information that can be used by the FSOC to force firms to raise capital, increase liquidity and sell assets deemed too concentrated in any segment of the economy.

'Not Fully Functioning'

The FSOC "was supposed to be the centerpiece of Dodd-Frank and is not fully functioning," said Jaret Seiberg, a financial services policy analyst at MF Global's Washington Research Group. "A year into Dodd-Frank, our expectations were the FSOC would be running on all six cylinders, and it's just not there."

Plans to designate systemically risky firms were set back by at least several months when lawmakers and industry executives complained that proposed criteria were too vague -- a criticism Bernanke and other regulators didn't dispute.

"What you need is clarity so people inside the box or outside the box understand why they are inside or outside," Representative Randy Neugebauer, a Texas Republican and chairman of a House Financial Services Committee panel, said in an interview. A January proposal listing criteria for designating non-bank financial companies "just restated" the language in Dodd-Frank without adding detail on how the council would make decisions, he said.

Size, Leverage

Richard Spillenkothen, a former director of banking and supervision for the Fed, suggested that the council should tie some of the proposed criteria -- including size, concentration, interconnectedness and leverage -- to specific measurements.

The FSOC hasn't "put any numbers to those metrics," Spillenkothen said. He suggested a revision with "some numeric of what we are talking about, without making it exclusively formulaic."

The collapse of AIG's financial-products unit in 2008 was an impetus for Dodd-Frank and the FSOC's creation. Collateral payments to banks that had bought protection from AIG through credit-default swaps led to a $182 billion taxpayer-funded bailout that gave the government a majority stake in the insurer.