US Fed plans to raise bank oversight thresholds, sources say
NEW YORK/WASHINGTON, Sept 25 (Reuters) – The US Federal Reserve is working on a plan to raise the asset thresholds that trigger stricter oversight of big banks, four people with knowledge of the matter said, which would allow some lenders to avoid costly additional regulation and potentially spur consolidation.
The central bank is expected to soon propose reindexing the thresholds where banks become subject to stress tests of their balance sheets, liquidity, capital and other more stringent rules, to account for inflation and economic growth, the people said. Three of the people said they expect the Fed to propose the changes later this year.Current rules impose stricter requirements when a bank reaches $100 billion in assets, stepping up at $250 billion and again at $700 billion. Lenders say those thresholds, set in 2019, haven’t kept pace with the economy, subjecting banks to increasingly stringent oversight that exceeds the risks they pose.
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