Financial regulators to warn about student debt risks

The panel of senior U.S. regulators charged with safeguarding the financial system will warn this week about risks posed by the rapidly growing amount of student debt, increasing pressure on policymakers to deal with the potential problem, The Huffington Post reports. At roughly $1 trillion and rising, education loans may hamper economic growth and limit home purchases as overly indebted households and young workers cut back on consumption and borrowing, the Financial Stability Oversight Council is poised to warn in its latest annual report, sources familiar with the matter said. The yearly compendium on financial developments and potential risks to the financial system, prepared by the nine agencies that comprise FSOC, will be made public on Thursday. Student debt will not be presented as an immediate threat to financial stability, these people said, but its mention in the report as a risk is likely to alarm a sector that has been in policymakers’ sights for the past year.

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