The regulator that oversaw the federal takeover of Silicon Valley Bank says the lender’s failure shows the need for tougher capital requirements for midsize banks.
US banks with at least $100 billion in assets would face new rules to put aside more capital in the event of unexpected stress, Martin Gruenberg, chairman of the Federal Deposit Insurance Corp., said in a prepared speech Thursday.
Community banks will be exempt from such rules, said Gruenberg, who’s speaking at the Washington-based Peterson Institute for International Economics.
“Strong, high quality capital is essential to fostering resilience in the banking system through economic cycles and periods of economic stress,” he said.
The long-awaited reforms are part of an international overhaul of capital rules in the wake of the 2008 global financial crisis. The effort is known as Basel III.
The FDIC will collaborate with the US Federal Reserve and the Office of the Comptroller of the Currency to unveil the measures this summer. Analysts have said the FDIC’s proposal could come as soon as next week.
