Fed’s Kashkari: Make big banks put 20% down—just like home buyers do
|Minneapolis Fed President Neel Kashkari wrote a piece in the Wall Street Journal (WSJ) today, an extract of which is here under:
“There's a straightforward way to help prevent the next financial crisis, fix the too-big-to-fail problem, and still relax regulations on community lenders: increase capital requirements for the largest banks.”
“In November, the Federal Reserve Bank of Minneapolis, which I lead, announced a draft proposal to do precisely that. Our plan would increase capital requirements on the biggest banks-those with assets over $250 billion-to at least 23.5%. It would reduce the risk of a taxpayer bailout to less than 10% over the next century.”
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