The US Federal Reserve on Tuesday previewed a scaled-down version of its proposed capital requirements for America's largest banks, after its original Basel III guidelines faced major opposition.
Under the new proposal, the eight biggest US banks, the so-called global systemically important banks – such as Goldman Sachs, Bank of America and JP Morgan Chase – would need to increase their capital by 9 per cent to act as a buffer against financial shocks, compared to a 19 per cent increase under the earlier proposal.
Other large banks, that are not considered global systematically important, would have to increase their capital by between 3 per cent and 4 per cent.
Banks with assets of between $100 billion and $250 billion would be exempt from the mandates other than a requirement to recognised unrealised gains and losses.
“It is critical that banks have the capacity to continue lending to households and businesses through times of stress. Bank capital is a key component of this resilience,” Fed vice chairman for supervision Michael Barr said at the Brookings Institution in Washington.
The new proposal is part of the Basel III endgame accord, an international regulatory framework for banks first agreed on after the 2007-2008 global financial crisis. The UAE implemented the Basel III endgame in 2017.
The Fed, the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation presented their initial proposal last year. It was criticised by myriad interests during the initial comment period.
The Financial Services Forum, a lobbying group for banks, said the Fed's 2023 proposal would mean higher borrowing costs and fewer loans for consumers and businesses. Others opposed to the rules said the move would hurt small businesses, homebuyers and minorities, while also harming energy projects and capital markets.
Wall Street also led a furious lobbying campaign against the proposals, flooding TV airtime with adverts attacking the proposed changes. Chief executives of the eight largest US banks also testified before Congress in December 2023 to challenge the reforms.
Following the criticism, Mr Barr and Fed Chairman Jerome Powell said there would be “broad and material” changes to the proposal. Mr Powell also attended a closed-door meeting with a group of banking executives in an effort to avoid a protracted legal battle over the proposal.
The US regulators' proposal has much stronger capital requirements than bank regulators in the EU. The Bank of England plans to publish its “near final” interpretation of the Basel III regulations on Thursday.
“The record of comments on the proposal includes a substantial amount of detailed and significant comments from a diverse range of industries – almost all of which express reservations about at least some aspects of the proposal,” Latham and Watkins said in a February report.
Mr Barr said the changes “reflect the feedback we have received from the public, improve the tiering of the proposal, and better reflect risks”.
He did not say when the Fed would officially put the new proposal forward. Banks would have one year to begin the implementation process once the rules are finalised. The original date was July 2025.
The complete changes to the proposal could be released as soon as September 19, Bloomberg reported.
COMPANY%20PROFILE
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The specs
Engine: 2.0-litre 4-cylturbo
Transmission: seven-speed DSG automatic
Power: 242bhp
Torque: 370Nm
Price: Dh136,814
UAE currency: the story behind the money in your pockets
Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
What can victims do?
Always use only regulated platforms
Stop all transactions and communication on suspicion
Save all evidence (screenshots, chat logs, transaction IDs)
Report to local authorities
Warn others to prevent further harm
Courtesy: Crystal Intelligence
The National's picks
4.35pm: Tilal Al Khalediah
5.10pm: Continous
5.45pm: Raging Torrent
6.20pm: West Acre
7pm: Flood Zone
7.40pm: Straight No Chaser
8.15pm: Romantic Warrior
8.50pm: Calandogan
9.30pm: Forever Young
Our family matters legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
The National Archives, Abu Dhabi
Founded over 50 years ago, the National Archives collects valuable historical material relating to the UAE, and is the oldest and richest archive relating to the Arabian Gulf.
Much of the material can be viewed on line at the Arabian Gulf Digital Archive - https://www.agda.ae/en
The biog:
Favourite book: The Leader Who Had No Title by Robin Sharma
Pet Peeve: Racism
Proudest moment: Graduating from Sorbonne
What puts her off: Dishonesty in all its forms
Happiest period in her life: The beginning of her 30s
Favourite movie: "I have two. The Pursuit of Happiness and Homeless to Harvard"
Role model: Everyone. A child can be my role model
Slogan: The queen of peace, love and positive energy
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
Ferrari 12Cilindri specs
Engine: naturally aspirated 6.5-liter V12
Power: 819hp
Torque: 678Nm at 7,250rpm
Price: From Dh1,700,000
Available: Now
MATCH INFO
What: 2006 World Cup quarter-final
When: July 1
Where: Gelsenkirchen Stadium, Gelsenkirchen, Germany
Result:
England 0 Portugal 0
(Portugal win 3-1 on penalties)
My Cat Yugoslavia by Pajtim Statovci
Pushkin Press
RESULTS
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The specs
- Engine: 3.9-litre twin-turbo V8
- Power: 640hp
- Torque: 760nm
- On sale: 2026
- Price: Not announced yet
Specs
Engine: Duel electric motors
Power: 659hp
Torque: 1075Nm
On sale: Available for pre-order now
Price: On request
MOUNTAINHEAD REVIEW
Starring: Ramy Youssef, Steve Carell, Jason Schwartzman
Director: Jesse Armstrong
Rating: 3.5/5
THREE POSSIBLE REPLACEMENTS
Khalfan Mubarak
The Al Jazira playmaker has for some time been tipped for stardom within UAE football, with Quique Sanchez Flores, his former manager at Al Ahli, once labelling him a “genius”. He was only 17. Now 23, Mubarak has developed into a crafty supplier of chances, evidenced by his seven assists in six league matches this season. Still to display his class at international level, though.
Rayan Yaslam
The Al Ain attacking midfielder has become a regular starter for his club in the past 15 months. Yaslam, 23, is a tidy and intelligent player, technically proficient with an eye for opening up defences. Developed while alongside Abdulrahman in the Al Ain first-team and has progressed well since manager Zoran Mamic’s arrival. However, made his UAE debut only last December.
Ismail Matar
The Al Wahda forward is revered by teammates and a key contributor to the squad. At 35, his best days are behind him, but Matar is incredibly experienced and an example to his colleagues. His ability to cope with tournament football is a concern, though, despite Matar beginning the season well. Not a like-for-like replacement, although the system could be adjusted to suit.
