WASHINGTON - A government financial stability agency would be created under a draft financial regulation reform bill from U.S. Senate Banking Committee Chairman Christopher Dodd obtained by Reuters on Tuesday.

The long-awaited Dodd bill departs from earlier proposals already made by the Obama administration and under development in the House of Representatives by calling for the agency, which would identify risks in the U.S. financial system.

Previous proposals have focused on establishing a council of existing regulators to police systemic risks.

The Dodd bill would also establish a National Insurance Office that would be the first attempt by the federal government to monitor the insurance industry.

The bill, as expected, backs the administration's call for creating a Consumer Financial Protection Agency. The bill proposes that the new agency be funded through fees charged to banks with $10 billion or more in assets and that the Federal Reserve transfer money annually to the agency.

The Federal Deposit Insurance Corp would be the primary agency for unwinding troubled financial firms, with the use of a systemic resolution fund, under the bill.

(Reporting by Kevin Drawbaugh, Rachelle Younglai, Karey Wutkowski; Editing by Theodore d'Afflisio)