Capital Rules Are Too Important for Stalling Tactics

For months, federal banking regulators have been working through proposed changes to U.S. capital requirements—rules that can shape the cost and availability of credit for families, homebuyers, and businesses across the economy.

The Federal Reserve, OCC, and FDIC released the proposals in March as part of an effort to modernize the capital framework and better align requirements with actual risk while maintaining a safe and sound banking system. Regulators then opened the proposals to months of public comment, which closed in June.

Now, Better Markets is suing the Federal Reserve and Vice Chair for Supervision Michelle Bowman, asking a federal court to throw out that process and force the Fed to start over before the capital rules are finalized.

Throwing out the process now would be a step backward.

Regulators have already spent months gathering public input from stakeholders across the debate. They should be allowed to review that feedback, weigh the evidence, and determine what the final framework should look like.

The current proposals represent progress toward a more modern, risk-sensitive capital framework, and the public comment process gives regulators the opportunity to refine that framework further. Starting over now would delay that progress.

As The Ledger Project has said throughout this process, strong capital requirements should be well-calibrated to actual risk. Getting that balance right can support a resilient financial system while preserving the flow of affordable, accessible credit that households and businesses rely on.

Capital rules are too important for procedural stalling.

The focus should remain on getting the final framework right: capital requirements that protect financial stability, reflect actual risk, and preserve the flow of affordable, accessible credit through the economy.

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