The Federal Reserve’s regulatory chief outlined steps to strengthen the financial cushions for larger banks, which he said would help boost the resilience of the system after a spate of midsize bank failures this year. The precise amount of additional capital would depend on a firm’s business activities, with the biggest increases expected to be reserved for the largest, most complex U.S. megabanks.
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America’s biggest banks are going to need more capital
“Capital isn’t free,” Kevin Fromer, the head of the banking group Financial Services Forum, said in a statement Monday. “Further capital requirements on the largest U.S. banks will lead to higher borrowing costs and fewer loans for consumers and businesses—slowing our economy and impacting those on the margin hardest.”
