"Big Banks' Capital Requirements Should Be Doubled, Regulators Say"

[applegrove]

Big Banks' Capital Requirements Should Be Doubled, Regulators Say

By Douwe Miedema at Reuters

http://www.huffingtonpost.com/2013/06/21/banks-capital-requirements_n_3478614.html?ncid=edlinkusaolp00000003

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WASHINGTON, June 21 (Reuters) - Two top U.S. bank regulators are pushing to double capital requirements for the country's largest banks, Bloomberg reported on Friday, as the debate about banks that are "too big to fail" heats up.

The Federal Reserve and the Federal Deposit Insurance Corp (FDIC) aim to raise the amount of shareholder capital banks must hold to 6 percent of their total assets, twice the internationally agreed-upon level, Bloomberg said.

Critics of large banks say this so-called leverage ratio is the best way to force banks to borrow less money to fund their business, because it does not allow them to rely on their own mathematical models to measure risk.

A source familiar with the talks told Reuters that discussions about the leverage ratio among the three U.S. bank regulators were ongoing, and that no number had been agreed on.

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