Federal Reserve Reportedly Plans Smaller Capital Hikes for Major U.S. Banks

WASHINGTON, D.C. — The Federal Reserve is reportedly considering a scaled-back version of a Biden-era proposal to raise capital requirements for the nation’s largest banks, according to a Bloomberg News report published Wednesday.

The updated plan, shared with other U.S. regulators, would significantly ease earlier requirements that Wall Street’s top lenders had strongly opposed. Under the revised framework, big banks could see their total capital requirements rise by only 3% to 7%, compared to the 19% increase previously outlined under the draft Basel III rules introduced in 2023.

The new proposal reflects months of industry lobbying and regulator reassessment amid concerns that stricter rules could limit lending and slow economic activity.

A spokesperson for the Federal Reserve declined to comment on the report, and Reuters noted it could not independently confirm the details.

Earlier this month, Reuters also reported that major banks expect a more favorable regulatory environment under President Donald Trump’s administration, as his financial regulators move to revise capital and liquidity standards.

The Basel III framework—developed in the aftermath of the 2007–2009 global financial crisis—aims to ensure financial stability by tightening capital, leverage, and liquidity rules for systemically important banks.

While supporters argue that higher capital cushions protect taxpayers and the economy from another banking crisis, critics say the 2023 proposal went too far, potentially restricting credit and dampening investment.

If adopted, the Fed’s scaled-down approach could mark a major shift in post-crisis banking oversight and offer relief to financial institutions long frustrated with what they describe as “overly burdensome” regulations.