Federal Reserve Bowman: After revising a comprehensive bank capital rule, the capital requirements for large banks will decrease slightly.

Federal Reserve Vice Chair for Supervision Bowman said Thursday that after revising a comprehensive set of bank capital rules, capital requirements for large banks will fall slightly. This is seen as a major win for Wall Street banks, which previously successfully resisted a proposal in an earlier draft to raise capital levels. Bowman outlined changes to the Basel framework and the additional capital requirements for globally systemically important banks (GSIB surcharge). These rules determine how much capital banks need to set aside to absorb potential losses. She said that by “reasonably calibrating” the existing rules, overall capital requirements for large banks would “fall slightly.” She said the adjustments will eliminate overlapping regulatory standards and make capital requirements better matched to banks’ actual risks, while also arguing that recent moves to continually increase banks’ loss-absorbing buffers have been misguided.