Fed to Relax Post-Recession Bank Capital Requirements
As the economy recovers, banking regulators are planning to loosen stringent capital rules put in place after the 2008 financial crisis. This move aims to spur lending and economic growth.
Federal Reserve officials and other regulators are preparing to loosen the strict capital requirements imposed on banks after the 2008 financial crisis, as the economy continues to recover. The move is aimed at boosting lending and economic growth, but also carries risks of greater financial instability.
The proposed changes, which are still being hammered out, would allow banks to operate with thinner financial cushions, reducing the amount of capital they must hold in reserve. Regulators say the post-crisis rules have made banks overly cautious about lending, hampering the economic recovery.
The debate reflects a broader push under the Trump administration to roll back financial regulations put in place after the recession. Jerome H. Powell, the Federal Reserve chair, has said he wants to ensure the rules are not needlessly constraining lending or economic growth.
{{IMAGE_PLACEHOLDER}}Source: The New York Times
