Bowman unveils Basel III revamp to align U.S. bank capital with risk
Federal Reserve Vice Chair Michelle Bowman outlined Basel III–based reforms to modernize U.S. bank capital rules: simplify duplicative calculations for large banks, harmonize risk-based and standardized approaches, adjust the G-SIB surcharge to reflect international methods and growth, and extend updates to smaller banks. The package also tightens supervision of operational, market, and CVA risk while introducing a standardized approach and adjustments to mortgage servicing assets and AOCI. Net effect is modest increases for the largest banks, modest reductions for some components, and somewhat larger relief for smaller banks, with a public comment period to follow.
