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Fed Hands Big Banks New Risk-Based Capital Surcharges

Joe Mont | July 20, 2015

The Board of Governors of the Federal Reserve has issued a final rule that establishes risk-based capital surcharges for financial institutions designated as a “global systemically important bank holding company (GSIB).”

The rule, finalized on Monday afternoon, affects eight of the nation’s largest banks. JPMorgan was handed the largest surcharge, 4.5 percent of its risk-weighted assets. Other banks on the list include Citigroup (a 3.5 percent surcharge); Bank of America (3 percent); Goldman Sachs (3 percent); Morgan Stanley (3 percent); Wells Fargo (2 percent); State Street (1.5 percent); and Bank of New York Mellon (1 percent).

The percentages were determined using formula the Fed first revealed in December 2014, and incorporating a Basel Committee on Banking Supervision framework that considers a...

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