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Fed, OCC proposes to lower the capital requirements for the largest banks





AFP / Getty Images

The headquarters of JP Morgan Chase in New York.

Federal supervisors reduced one of the safety standards for the largest banks introduced after the financial crisis on Wednesday.

The Federal Reserve and the Office of the Comptroller of the Currency proposed a rule: to adjust the leverage ratio requirements to the business activities and risk profiles of the largest domestic banks

The regulators estimated that the proposed changes would be the required amount of capital for Bank holding companies by about $ 400 million.

Fed governor Lael Brainard voted against the proposed plan. Banks have complained about the rule that keeps them from participating in the derivatives market.

Fed Chairman Jerome Powell had signaled that the US Federal Reserve would repay them.

According to the old rule, the biggest banks all have the same leverage ratio. The new rule allows companies to customize the rule for their institution.

There are eight globally significant US banks, including J.P. Morgan Chase

JPM, -1

.68%

and Goldman Sachs

GS, -1.41%

. It is expected that the change will help banks in the custody business like State Street

STT, -1.28%

and Bank of New York Mellon

BK, -0.84% ​​

.


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