U.S. regulators have approved new final rules that ease leverage requirements for large banks, reducing the amount of capital they must hold against low-risk assets. The Federal Deposit Insurance Corporation cleared the updated “enhanced supplementary leverage ratio,” with other regulators expected to follow.
An FDIC memo estimated that the revised standard will lower total capital needs for major institutions by approximately $13 billion, or less than 2%. In comparison, their depository subsidiaries will see a significantly larger reduction of 27%, equal to roughly $213 billion. Officials noted that banks will not be able to increase shareholder payouts because holding companies remain subject to broader capital constraints.
The final rule largely matches the June proposal, adjusting capital levels to reflect each bank’s systemic footprint. Banks had argued that the earlier standard became restrictive as government debt grew, limiting routine activities. The new requirement must be met by April 1, 2026; however, banks may adopt it voluntarily as early as 2026.
The move marks one of the first efforts to ease post-financial-crisis safeguards, a shift the administration says will support economic growth. Critics argue that lowering capital buffers introduces unnecessary risk. Regulators also moved forward with a proposal to cut the community bank leverage ratio from 9% to 8% for institutions with less than $10 billion in assets, indicating a wider adjustment of capital standards across the industry.
