“A top Federal Reserve official Wednesday called on Congress to consider capping the size of the nation’s financial firms, marking one of the most high-profile challenges to the way Wall Street does business.
In a Philadelphia speech, Fed governor Daniel Tarullo recommended curbing banks’ growth by putting a limit on their nondeposit liabilities, which are sources of funding for operations that go beyond consumer deposits. The idea takes direct aim at the biggest U.S. banks, including J.P. Morgan Chase & Co., Bank of America Corp., Goldman Sachs and Citigroup Inc. all of which rely heavily on such funding. Firms outside of this tier make much greater use of regular deposits.”
Read Victoria McGrane and Alan Zibel’s full article here.