Big Banks Warn Regulators: Tougher Capital Rules Will Hurt Everyone | White & Case LLP International Law Firm, Global Law Practice
Big Banks Warn Regulators: Tougher Capital Rules Will Hurt Everyone

Big Banks Warn Regulators: Tougher Capital Rules Will Hurt Everyone

US banks are concerned that new capital requirements that the FDIC, Federal Reserve, and Office of the Comptroller of the Currency want to set will hurt the economy by making it harder for banks to lend and keep the economic recovery going. Yet, whether the new requirements are too strict or not strict enough is still being debated.

"A bank supervisor will never say that a banking organization has enough capital," says White & Case Partner Ernie Patrikis, who had a 30-year career at the Federal Reserve Bank of New York, where he served as general counsel. "Are banks now treated as public utilities? The Fed approves dividends and sets interest rates, and seems to have a policy that banks must be able to continue to lend in a severe downturn in the economy."