Sifma's CEO points out that Basel III could harm capital markets. He mentions that, according to Powell, changes are expected. Sifma and others are calling for a new proposal, pointing out that large banks, particularly those involved in capital markets, will be negatively affected. The increases in capital charges for certain products could be as high as 130%.
The CEO acknowledges that the aim of the proposal is to strengthen the security of the financial sector and prevent bank failures. However, he argues that bank capital in the US has already increased considerably, meeting stability targets. He criticises the proposal for its impact on capital market activities and its interaction with existing prudential and liquidity requirements. He stresses the importance of capital markets in financing business activity in the US and warns that increased capital costs could have a negative effect on the economy.
Bloomberg TV provided by MT Newswires
