Overview
- Wall Street trade groups sent a coordinated letter to the Fed, FDIC and OCC on June 17, and large banks submitted formal comment letters by the June 18 deadline asking regulators to ease the March Basel Endgame proposal.
- Industry targets the market-risk module that sets trading capital, saying draft calculations could raise capital for trading activities by roughly 30% to 89% and thereby make banks less willing to make markets in U.S. Treasuries.
- Banks are also pressing regulators to remove or reduce capital for unused credit lines known as unconditionally cancelable commitments and to shrink the extra GSIB surcharge that applies to the largest globally connected banks.
- The Basel Committee is separately reviewing crypto capital treatment after current rules assign a 1,250% risk weight to many tokens, a charge that industry says effectively bars banks from holding Group 2 crypto assets.
- U.S. regulators cut aggregate capital requirements by about 4.8% to 5% in March and are wrapping up rulemaking, but critics warn further rollbacks could weaken bank resilience while supporters say easing frees balance-sheet capacity for lending and market activity.