“The Federal Reserve on Tuesday approved sweeping new capital standards for the nation’s biggest banks and warned the titans of Wall Street that more restrictions were on the way.
“In a vote that was unanimous, the Fed agreed to final rules implementing the international Basel III accord, a global agreement that was reached among regulators to beef up capital cushions after the 2008 financial crisis.
“‘Capital will act as a financial cushion to absorb future losses,” said Federal Reserve Chairman Ben Bernanke. “Strong capital requirements are essential if we hope to have safe and sound banks.’
“The Independent Community Bankers of America praised the Fed for ratcheting down the requirements, but said it remained “disappointed” that smaller banks were not exempted entirely from the standards.
“Meanwhile, proponents of tough Wall Street reforms were disheartened by the rules as a whole. The reform advocacy group Better Markets called the Fed plan “grossly insufficient,” saying it allowed banks to conduct far too much business with borrowed cash.”
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