Republican members of the U.S. House Committee on Financial Services sent a letter to Federal Reserve Vice Chair for Supervision Michelle Bowman, Office of the Comptroller of the Currency Comptroller Jonathan Gould, and Federal Deposit Insurance Corporation Chairman Travis Hill urging that the forthcoming Basel III Endgame large bank capital proposal be calibrated to protect safety and soundness without unnecessarily restricting credit or harming economic growth. The letter argues the proposal should reflect the structure of the U.S. financial system, avoid excessive or duplicative requirements when layered onto the existing U.S. capital framework, and maintain international competitiveness. It warns that overly high capital requirements could raise mortgage costs, reduce business investment, tighten farmers’ margins with knock-on effects on food costs, and lower overall economic growth. To support the case for U.S.-specific calibration, it cites 2024 data showing 76.8 percent of debt financing for nonfinancial firms came from corporate bond markets and 23.2 percent from bank loans, and contends the U.S. should be willing to deviate from the 2017 Basel Committee recommendations where appropriate while avoiding “gold-plating” that previously drew negative feedback. The Committee members asked that the notice of proposed rulemaking and any final rule be designed so the various elements of the capital framework work together and do not double count risks as the agencies proceed with the public comment process.
U.S. Financial Services Committee 2025-12-19
U.S. House Committee on Financial Services Republicans urge regulators to take a balanced approach to Basel III Endgame capital rules
Republican members of the U.S. House Committee on Financial Services urged Federal Reserve, OCC, and FDIC leaders to ensure the Basel III Endgame large bank capital proposal protects safety and soundness without restricting credit or harming growth. They emphasized U.S.-specific calibration to avoid excessive requirements and maintain international competitiveness, citing reliance on corporate bond markets. The letter also called for a cohesive capital framework that avoids risk double-counting during the rulemaking process.