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AFR Statement: Fed Proposal Chips Away At Post-Crisis Reforms

Submitted by on October 31, 2018 – 12:27 pm

FOR IMMEDIATE RELEASE

Oct. 26, 2018

CONTACT:

Carter Dougherty, carter@ourfinancialsecurity.org,

(202) 251-6700

Fed Proposal Chips Away at Post-Crisis Reforms

Statement from Marcus Stanley, policy director, Americans for Financial Reform:

Today’s proposals to restructure capital and liquidity requirements for large banks represent the latest chapter in the gradual chipping away of post-crisis financial reforms. The proposals go well beyond anything required by Congress, and significantly weaken requirements for large banks to hold cash and easily salable liquid assets to satisfy payment requirements in times of economic stress. The regulators themselves admit that these changes would increase the likelihood of liquidity-related bank failures. It is also concerning that in today’s Fed meeting the regulators announced that they are working on a future proposal to change rules governing foreign mega-banks operating in the U.S. – a change that is most likely related to weakening requirements for these critical players in the U.S. financial system.

While we are continuing to assess the details of these proposals, we are very concerned by the current direction of regulatory change, which is consistently focused on weakening important regulatory requirements for large banks. There is absolutely no reason or justification for such weakening.

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