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Big Banks Face up to 4.5% Capital Surcharge

Fed proposes methods to calculate surcharges for eight big U.S. banks, above Basel III requirements.

By Yalman Onaran, Jesse Hamilton and Ian Katz, Bloomberg | Updated on December 09, 2014

Big U.S. banks face capital surcharges of as much as 4.5 percent as the Federal Reserve readies new capital rules that single out firms reliant on short-term market funding as posing the greatest systemic risk.

The Fed today proposed two methods to calculate what capital surcharges eight big U.S. firms will face on top of those already levied on the world’s largest banks by international regulators. While the central bank stopped short of listing the surcharges for each firm, it said they probably will range from 1 percent to 4.5 percent based on 2013 data—exceeding the maximum of 2.5 percent set under global rules.

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