The Federal Reserve says it will restore capital requirements for large banks that were relaxed as part of the Feds efforts to shore up the financial system during the early days of the pandemic.
(AP Photo/Susan Walsh, Pool)WASHINGTON – The Federal Reserve says it will restore capital requirements for large banks that were relaxed as part of the Fed’s efforts to shore up the financial system during the early days of the pandemic.
But the SLR, unlike other bank capital requirements, doesn't take risk into account.
Bank lobbyists argue that without an extension of the exemption, large banks will be less likely to hold Treasury securities.
“We are also confident that the thousands of community banks that are not subject to the SLR requirements would be happy to accept deposits that large banks may reject,” they said.