U.S. Sens. Tim Scott (R-SC) and Mike Rounds (R-SD) are among a group of Senate Republicans urging the Federal Reserve Board to finalize Basel III Endgame rulemaking.
“In assessing the final rule, we urge the Board to view capital requirements holistically,” the senators wrote in a letter to Jerome Powell, chairman of the Fed and Michelle Bowman, vice chair for supervision, said. “As part of this effort, the Board should endeavor to make sure that any proposal uses the baseline that existed before the post-pandemic capital ramp-up, not relative to today’s elevated capital levels.”
Along with Scott and Rounds, the letter was signed by Sens. Mike Crapo (R-ID), Thom Tillis (R-NC), John Kennedy (R-LA), Bill Hagerty (R-TN), Cynthia Lummis (R-WY), Katie Britt (R-AL), Pete Ricketts (R-NE), Kevin Cramer (R-ND), Bernie Moreno (R-OH), and Dave McCormick (R-PA).
“Since 2020, aggregate common equity tier 1 ratios for large U.S. banks have increased by more than 20 percent. This rise was driven in part by the growth in the Board’s balance sheet and the economy, not increased risk. Using current capital levels as the reference point would institutionalize excessive requirements, leading to higher costs and less access to capital for U.S. consumers and small businesses,” the letter continued.