SIFMA today released the following statement from Kenneth E. Bentsen, Jr., president, after the Federal Deposit Insurance Corporation approved a proposal to increase the leverage ratio for bank holding companies and insured depository institutions.
"Ensuring financial institutions have sufficient capital is a key component of the larger regulatory effort to enhance the safety and soundness of our financial system. We continue to support efforts to achieve this goal, especially implementation of the Basel III capital standards.
"The FDIC's proposal to increase the leverage ratio for large financial institutions needs to keep in mind the cumulative impact of all regulatory proposals on the table. No one rule will take care of all issues or make the industry safe from all further crisis. The U.S. has had a leverage ratio for a long time, and the devil will be in the details of how and when that potential new standard must be met.
"In the end, federal regulators must strike the right balance. Excessive capital levels will limit the ability of financial institutions to lend to small businesses and families that help drive economic growth and job creation, and weaken American financial institution's ability to compete globally."