US to propose revised Basel III rules this month

The US Federal Reserve and other regulators are expected to announce significant changes to proposed bank capital rules as early as September 19th, according to Bloomberg News.

The revisions, which could total up to 450 pages, are aimed at addressing concerns raised by banks regarding the original Basel III Endgame proposal. The new rules are likely to include reductions in capital requirements for certain business lines, such as wealth management and credit card operations.

The revised proposal is also expected to ease market-risk requirements for large banks, particularly in areas like mortgages and tax-equity exposures.

Federal Reserve Vice Chair Michael Barr will provide a preview of the revised proposal and outline the next steps at the Hutchins Centre on Fiscal & Monetary Policy on September 11th.

The Basel III rules were introduced following the 2007-2009 global financial crisis to strengthen bank capital requirements. Banks have been advocating for changes to the rules, arguing that they are too burdensome.

Regulators have been working diligently to revise the proposal while balancing the need for stronger bank capital with the potential impact on the economy.

Attribution: Reuters & Bloomberg