A capital standards proposal made by U.S. bank regulators in 2023 fell flat among members of the “international community” as they considered it going too far, the acting head of the national bank regulator claimed Tuesday.
According to Acting Comptroller of the Currency Rodney Hood, speaking before a meeting of the U.S. Chamber of Commerce, the “international community” showed consensus that the U.S. proposal “had gone beyond what was necessary.” Hood said he reached that conclusion “at a recent meeting in Basel,” referring to the city in Switzerland. He didn’t identify the meeting specifically, nor what comprised the “international community” he referred to.
“As we continue interagency deliberations, I will remain committed to a capital framework that supports resilience—but does not constrain growth,” Hood told the group.
The 2023 proposal was aimed at improving “the resilience of the U.S. banking system by modifying capital requirements for large banking organizations to better reflect their risks and apply more transparent and consistent requirements across large banking organizations.”
The proposal was billed as a method for implementing the Basel III “endgame” (a second set of Basel III proposals that were released in 2017), but also responding to the failure in spring 2023 of three mid-size banks.
Hood indicated that the OCC is now focused on modernizing capital standards. “While U.S. banks remain the gold standard of international finance, that doesn’t mean we must ‘gold-plate’ our capital requirements,” Hood said. “I’ve engaged extensively with my U.S. and global counterparts to advocate for capital levels that are strong, but appropriate—not excessive.”
In other comments, Hood said his agency is examining adjustments to the supplementary leverage ratio “to ensure it functions as a true backstop—not a primary constraint that limits lending unnecessarily.”
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