Washington's Pivot on Bank Rules Could Free Up Tens of Billions
The biggest banks seem poised to win a reprieve in Washington, maybe even to the tune of tens of billions of dollars.
The Wall Street Journal reported that regulators are considering making significant changes to a recent proposal that would require banks to have more capital. This comes after intense lobbying by the biggest banks, led by JPMorgan Chase’s Jamie Dimon.
The upshot is that modifications to the proposal could on average cut the increase in requirements for big banks roughly in half from what was originally floated, the Journal reported—a development that will have some bank shareholders and customers cheering, even if critics say it leaves the financial system more vulnerable to shocks.
In bottom-line terms, regulatory agencies had previously estimated that the core capital requirement for the largest categories of banks would rise by 19%. That would translate into roughly $150 billion more capital for the eight U.S. global systemically important banks, based on estimates of their current requirements as of the first quarter by analysts at Barclays. Those banks are Bank of America, Bank of New York Mellon, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley, State Street and Wells Fargo.
https://www.wsj.com/finance/regulation/washingtons-pivot-on-bank-rules-could-free-up-tens-of-billions-109713c0?st=qzjgbn1hvq9rbo3&reflink=desktopwebshare_permalink
Guess the lessons of 2007 are a fading memory...
