- Bank Of America Corp (NYSE:BAC) and peers are trading higher Tuesday amid reports of up to 20% hike in capital requirements.
- U.S. regulators look to order large banks to shore up their financial footing to boost the system’s resilience after a spate of midsize bank failures this year.
- By June, the regulators are on track to propose a rise in overall capital requirements by roughly 20% at larger banks on average, a shift from the lighter regulatory approach taken during the Trump administration.
- The precise amount will depend on a firm’s business activities, with the most significant hikes likely for U.S. megabanks with big trading businesses.
- Banks heavily dependent on fee income—like investment banking or wealth management—could also face significant capital boosts.
- Three agencies – the Federal Reserve, Federal Deposit Insurance Corp., and the Office of the Comptroller of the Currency will likely propose and seek comment on the capital rules.
- Regulators will likely propose ending a regulatory reprieve that had allowed some midsize banks to effectively mask losses on securities they hold, a contributing factor in the collapse of SVB Financial Group (OTC:SIVBQ).
- Other bank stocks, including Citigroup, Inc (NYSE: C), U.S. Bancorp (NYSE: USB), and Wells Fargo & Co (NYSE: WFC) stocks, are also trading higher Tuesday.
- Price Action: BAC shares traded higher by 2.77% at $29.32 on the last check Tuesday.
- Photo via Wikimedia Commons
Southwest Airlines Recovery Pushed to 2025: Profitability Delayed, but Strong Balance Sheet Remains Intact, Analyst Says
Raymond James analyst Savanthi Syth downgraded the Southwest Airlines Co (NYSE: LUV) stock from Strong Buy to Outperform and cut the price target on Southwest Airlines
