Fed's Barr defends new capital rules despite Wall Street backlash

Federal Reserve vice chair of supervision Michael Barr defended the new US proposal requiring banks to increase their capital buffers, countering claims that it would hinder lending and harm the economy. Barr cited the positive outcomes of similar changes made after the 2008 financial crisis, including the growth of the banking system and increased profitability. US regulators proposed a 16% increase in capital requirements, primarily affecting large banks, and are accepting comments on the proposal until November 30. Banks have pushed back against the changes, arguing that the initial proposal lacks transparency and could lead to increased lending in private credit markets.