Banking Regulators Recommend Volcker Reassessment And Other Reforms

In a hearing on "Regulation and Economic Growth" held by the Senate Committee on Banking, Housing, and Urban Affairs, bank regulators testified on the current banking environment and outlined principles, recommendations, and objectives to promote future efficiency.

Board of Governors of the Federal Reserve System ("FRB") Governor Jerome Powell focused on regulatory developments including (i) capital requirements for banks, including common equity tier 1 capital requirements and an additional surcharge for global systematically important banks, (ii) mandatory stress testing for large banks, (iii) the liquid coverage ratio requirement, and (iv) resolvability planning obligations. He testified that the FRB will explore the measures aimed at reducing regulatory burdens including a reassessment of Volcker Rule requirements that do not directly relate to its main policy goals, and an examination of the leverage ratio to ensure that it is properly calibrated to prevent