Fed’s Barr, in his role as vice chairman of supervision, has stated:
- The advantages of the proposed increase in bank capital outweigh the associated costs.
- While higher capital requirements may result in increased funding costs for banks, they will also enhance their ability to absorb losses.
- The impact of post-capital hikes will mainly affect banks engaged in trading activities, with limited effects on lending costs.
- He welcomes all feedback on the proposed rule to ensure that it accurately reflects the associated risks.
- Additionally, he will be closely monitoring any comments he may have on the economy or monetary policy following the release of the US jobs report on Friday and will provide more context accordingly.