Fed Moves to Ease Bank Leverage Rules

The Federal Reserve meets on Wednesday to advance a proposal that would ease leverage rules for banks, which would grant the industry a long-sought win they say will help big firms facilitate Treasury market trading.

- REUTERS

The central bank's Washington board will consider a plan to revamp the so-called supplementary leverage ratio (SLR), which directs banks to hold capital against assets regardless of their risk level.

Originally designed as a backstop to ensure banks hold some capital on even relatively risk-free assets like U.S. Treasury debt, the industry complains it has become a constraint that actually impedes their ability to facilitate trading in U.S. Treasury markets during times of stress.