Wall Street watchdogs are poised to take a major step toward overhauling limits on banks’ ability to trade with their own funds, according to people familiar with the effort.
Fresh data from the Fed, FDIC and Bank of England shows that, directly or indirectly, banks are taking on more leveraged loans. But whether this puts their loan and securities portfolios at risk remains open for debate.
Banks need to mitigate potential bias in algorithmic predictive models using artificial intelligence, as regulators are weighing how to oversee the emerging technology.
The FDIC chief said it is critical to give the industry clarity on using emerging technologies, particularly for the thousands of community banks her agency oversees.
The regulators have yet to complete rules on regional bank supervision, community bank capital and other provisions meant to ease institutions' burden.
Expanding exemptions for initial margin requirements on swaps transactions “would harm financial stability and U.S. taxpayers,” said the top Democrats on the House and Senate banking panels.
Among other things, the letter asked the regulators to ease requirements for a new community bank leverage ratio and analyze the impact of the pending CECL accounting change.
