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Post by bot on May 3, 2014 2:41:54 GMT -5
WASHINGTON (MarketWatch) -- There's more work to be done to address too-big-to-fail concerns, Federal Reserve Chairwoman Janet Yellen told community bankers on Thursday as she specifically highlighted reliance on potentially volatile short-term wholesale funding. "We are carefully considering the systemic vulnerabilities that may be posed by overreliance on short-term wholesale funding and are weighing potential policy responses," said Yellen. Yellen also said the Fed is working to implement risk-based capital surcharges for systemically important firms. She noted that the Fed has strengthened requirements for stress testing and capital planning, that capital requirements for the largest firms have been strengthened by risk-based and leverage capital requirements. On community banks, she pointed out there's "slow but steady loan growth" that she considers an encouraging sign of an improving economy.
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