Federal Reserve Proposes Easing Capital Rules for Biggest U.S. Banks
Jun 25, 2025
On Wednesday, the Federal Reserve introduced a proposal to ease a key capital rule for the largest U.S. banks. This plan focuses on changing the 'enhanced supplementary leverage ratio,' which determines how much capital large banks must hold against their low-risk assets, like U.S. Treasury securities.
The proposal was voted on by the Fed's board, passing with a 5-2 split, showing some division among central bank officials. The move is intended to overhaul how large, global banks manage their balance sheets, possibly making it easier for them to participate in the U.S. Treasury market.
Estimates suggest that easing these rules could free up between $185 billion and $213 billion in capital for big banks including JPMorgan Chase, Bank of America, Goldman Sachs, and Morgan Stanley. It could also unlock nearly $6 trillion in balance sheet capacity according to reports.
What does it mean to ease capital requirements for banks?
It means banks may be allowed to hold less money in reserve against certain assets, which can give them more flexibility to lend or invest.
Why is the Federal Reserve doing this?
The Federal Reserve wants to make it easier for large banks to take part in the U.S. Treasury market and manage their assets more effectively.
Which banks are most affected by this proposal?
Major U.S. banks like JPMorgan Chase, Bank of America, Goldman Sachs, and Morgan Stanley are among those most affected.
Is this change final?
No, the proposal has been introduced and passed an initial vote, but it is not yet final. Further steps are needed before any changes take effect.
Sources
Divided Fed proposes rule to ease capital requirements for big Wall Street banks
CNBC
CNBC
The Federal Reserve proposed easing a key capital rule for banks, and central bank officials will vote on the measure at 2 p.m. Wednesday.
Fed Votes to Advance Proposal to Ease Banks' Capital Requirements
PYMNTS
PYMNTS
The Federal Reserve reportedly voted Wednesday (June 25) to advance a proposal that would ease the “enhanced supplementary leverage ratio” that determines the amount of capital banks must hold against relatively low-risk assets. [contact-form-7] The Fed board voted 5-2 to advance the proposal, Reute...
Divided Fed proposes rule to ease capital requirements for big Wall Street banks...
CNBC Television
CNBC Television
The Federal Reserve unveiled a proposal on Wednesday to ease Tier 1 capital requirements for the biggest U.S. banks, CNBC's Leslie Picker reports, though not everyone at the central bank agreed with the decision.
Fed unveils proposal to ease bank leverage requirements.
CNBC Television
CNBC Television
CNBC's Leslie Picker reports on news regarding banking regulations.
Fed unveils proposal to ease bank leverage requirements
Reuters
Reuters
The Federal Reserve unveiled a proposal on Wednesday that would overhaul how much capital large global banks must hold against relatively low-risk assets, as part of a bid to boost participation in U.S. Treasury markets.
Fed plan to ease leverage rule offers windfall for big US banks, Morgan Stanley...
Reuters
Reuters
A Federal Reserve plan to relax leverage rules could free up $185 billion in capital and unlock nearly $6 trillion in balance sheet capacity for large U.S. global banks covered by Morgan Stanley, the brokerage estimated on Thursday.
Fed Proposes Easing Capital Requirements for Major Banks
Zacks Investment Research
Zacks Investment Research
Fed plan to ease capital rules could unlock $213B for major U.S. banks, including JPM, BAC, GS and MS.
Bank of America Corp
Banking
Price
Intrinsic Value
54.08
65.87
Morgan Stanley
Financial Services
Price
Intrinsic Value
179.71
402.55
JPMorgan Chase & Co
Banking
Price
Intrinsic Value
310.11
298.35
Wells Fargo & Co
Banking
Price
Intrinsic Value
90.69
100.57
Citigroup Inc
Banking
Price
Intrinsic Value
111.09
149.28
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