(Reuters) -The Federal Reserve has begun developing a new risk-based capital rule aimed at easing the burden on the largest U.S. banks than a Biden-era plan, Bloomberg News reported on Friday, citing people familiar with the matter.<\/p>\n
Regulators are largely scrapping the original 1,087-page proposal from two years ago and plan to unveil a new one as early as the first quarter of 2026, the report added.<\/p>\n
Vice Chair for Supervision Michelle Bowman is leading efforts to develop the new rule, that would aim to simplify how banks calculate their capital requirements, according to the report.<\/p>\n
Representatives of the Federal Reserve declined to comment, when contacted by Reuters.<\/p>\n
The “Basel III” standard was agreed after the 2007-09 global financial crisis. It includes numerous capital, leverage and liquidity requirements. Regulators across the world have worked for years to implement many of those standards, and the so-called “endgame,” agreed in 2017, is the final iteration.<\/p>\n
These capital requirements serve as a financial cushion to enhance the resilience of these big banks against economic stress and safeguard the broader financial system.<\/p>\n
The banking industry lobbied for a significantly weaker version of the “Basel Endgame” capital rule under the Trump administration, which was viewed as more favorable compared to the Biden-era approach.<\/p>\n
The proposed rules, which would apply to banks with more than $100 billion in assets, would overhaul how the largest banks manage their capital, with potential ripple effects on their lending and trading activities.<\/p>\n
The rules aim to prevent another financial crisis by requiring the largest U.S. banks, including JPMorgan Chase, Bank of America, and Goldman Sachs, to collectively set aside nearly $1 trillion to absorb potential losses from loans and trading activities.<\/p>\n
However, banks say additional capital is unnecessary and will hurt the economy, and have aggressively lobbied against the project.<\/p>\n
(Reporting by Pritam Biswas in Bengaluru; Editing by Shailesh Kuber)<\/p>\n","protected":false},"excerpt":{"rendered":"(Reuters) -The Federal Reserve has begun developing a new risk-based capital rule aimed at easing the burden on…\n","protected":false},"author":2,"featured_media":51145,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[77,7540,4319,6436,29209,4349,19076,29210],"class_list":{"0":"post-51144","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-basel","8":"tag-basel","9":"tag-basel-iii","10":"tag-bloomberg-news","11":"tag-capital-requirements","12":"tag-capital-rule","13":"tag-federal-reserve","14":"tag-michelle-bowman","15":"tag-risk-based-capital-rule"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@ch\/116426323031647010","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/51144","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/comments?post=51144"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/51144\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/media\/51145"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/media?parent=51144"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/categories?post=51144"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/tags?post=51144"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}