Treasury to appeal MetLife's too-big-to-fail win

The U.S. Treasury Department confirmed late Thursday that it would appeal a judge's decision overturning insurer MetLife's too-big-to-fail status, ratcheting up the tension over a designation that other companies are also seeking to shed.

The move signaled that the Obama administration is preparing to aggressively defend the label it has assigned to so-called non-bank Systemically Important Financial Institutions, which subjects the companies to greater scrutiny by the Federal Reserve.

The Treasury Department issued a one-sentence statement simply saying that it would appeal a ruling by District of Columbia federal judge Rosemary Collyer that MetLife did not pose a risk to the financial system.

Government's too-big-to-fail authority slammed by judge

The decision to appeal was not unexpected after Collyer blasted the Financial Stability Oversight Council for "arbitrary and capricious" handling of MetLife's risk assessment.

Collyer's decision appeared to empower General Electric into requesting that the FSOC drop the too-big-to-fail designation assigned to its GE Capital business following the unit's significant reduction in size.

Insurance giants American International Group and Prudential Financial have also signaled that they could seek to escape their designations as threats to the U.S. financial system.

MetLife last week hailed Collyer's ruling as "a win for MetLife’s customers, employees and shareholders.”

Treasury Department Secretary Jack Lew said in a statement before the decision to appeal: "I strongly disagree with the court’s ruling. This decision leaves one of the largest and most highly interconnected financial companies in the world subject to even less oversight than before the financial crisis."

Follow USA TODAY reporter Nathan Bomey on Twitter @NathanBomey.