U.S. Regulator Plans to Ease Big Bank Capital Rule, Potentially Releasing Billions

On March 19, the Federal Reserve (Fed) on Thursday released a proposal to ease capital requirements for top Wall Street banks—a move that could unlock tens of billions of dollars for lending, stock buybacks, and dividend payouts. Fed Vice Chair for Supervision Michelle Bowman said in a statement: “These reforms will strengthen our overall capital framework, which will remain robust under the new regulatory regime.” The proposal will undergo a 90-day public comment period before finalization. It was developed jointly by the Fed, the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC). The Fed Board will formally vote on the plan Thursday. Officials frame it as part of capital simplification efforts. If adopted—alongside relaxed enhanced supplementary leverage ratio (eSLR) rules and stress testing reforms—the package would represent the largest overhaul of U.S. bank capital rules since post-2008 global financial crisis measures were rolled out. A Fed memo notes the combined proposals are expected to deliver a “modest reduction” in capital requirements for large banks. (Source: Wall Street.cn)