Federal government officials have said that the insurance giant American International Group and GE Capital will be subjected to more government scrutiny and financing requirements as the two companies could pose a threat to the financial system.

The Financial Stability Oversight Council has approved a decision to designate American International Group and GE Capital as systemically important. This is first time that the government has taken such an action under the
2010 Dodd-Frank financial reform act. The move would meant that the companies will be required to maintain larger capital reserves and will be regulated by the Federal Reserve.

The council, which is headed by Treasury Secretary Jacob Lew, had identified the companies as systemically important in June. The council was formed after the 2008 financial crisis to keep a check on the companies that could pose a threat to the financial system. The council has also designated Prudential Financial as systemically important but the company has said that it will appeal the decision.

"Today, the council has taken a decisive step to address threats to U. S. financial stability and create a safer and more resilient financial system. In a statement, AIG said that it "did not contest this designation and welcomes it," Lew said in a statement.