Sens. Sherrod Brown (D-Ohio) and David Vitter (R-La.) applauded on Tuesday a plan by banking regulators to increase the mandatory leverage ratio for banks, calling the move a “major step forward.”
Banking regulators, including the OCC, Federal Reserve and FDIC, introduced a proposal last week to raise the leverage ratio buffer two percent above the current three percent minimum for holding companies.
“This is a major step in the right direction of higher capital standards that so many, including Sherrod Brown and me, have been pushing for. And the regulators are saying they may consider more,” Vitter said. “For our part, we’ll continue to build support for Brown-Vitter and the complete and final end to ‘too big to fail.’”
In April, Brown and Vitter introduced the Terminating Bailouts for Taxpayer Fairness Act, which aims to ensure that banks and other financial institutions have sufficient capital to protect against losses and prevent a future taxpayer-funded bailout.
“It’s encouraging that regulators are moving toward the standards in Brown-Vitter, which would end too-big-to-fail by ensuring that Wall Street megabanks can back up their risky practices,” Brown said. “Today’s announcement is a major step forward, but it should only be the first step. We must do more, and this proposal will be insufficient if it is weakened by Wall Street lobbying. That’s why we must pass Brown-Vitter and end too-big-to-fail once and for all.”