{"id":10321,"date":"2023-09-11T21:51:07","date_gmt":"2023-09-11T21:51:07","guid":{"rendered":"https:\/\/prosfunds.com\/business\/jamie-dimon-warns-investors-over-bank-stocks-if-us-capital-rules-enacted\/"},"modified":"2023-09-11T21:51:08","modified_gmt":"2023-09-11T21:51:08","slug":"jamie-dimon-warns-investors-over-bank-stocks-if-us-capital-rules-enacted","status":"publish","type":"post","link":"https:\/\/prosfunds.com\/?p=10321","title":{"rendered":"Jamie Dimon warns investors over bank stocks if US capital rules enacted"},"content":{"rendered":"<div>\n<p>Receive free US financial regulation updates<\/p>\n<p class=\"article__content-sign-up-topic-description\"><span>We\u2019ll send you a <i>myFT Daily Digest<\/i> email rounding up the latest<!-- --> <!-- -->US financial regulation<!-- --> news every morning.<\/span><\/p>\n<p><iframe class=\"article__content-sign-up-iframe close\" scrolling=\"no\" id=\"signUpIframe\" data-prev-url=\"\/register\/in-article-sign-up?ft-content-uuid=ccd0f68c-2543-4e02-bbbc-0101d04609e1&amp;concept-id=5aa772ee-40a2-4c20-87be-8925d54d6ba6\"><\/iframe><\/div>\n<div data-attribute=\"article-content-body\">\n<p>JPMorgan Chase chief executive Jamie Dimon criticised US regulators over recent proposals for new capital rules, warning they risked making bank stocks uninvestable and would result in borrowers having to pay more for loans.<\/p>\n<p>At issue are proposals outlined in July by the Federal Reserve as part of the final implementation of international banking standards, the so-called Basel III endgame reforms.<\/p>\n<p>Dimon is the latest senior Wall Street executive to push back on the Fed\u2019s proposals. One of the industry\u2019s leading lobby groups last week announced an advertising campaign called \u201cStop Basel Endgame\u201d.<\/p>\n<p>JPMorgan\u2019s CEO said the proposed reforms would curtail lending by banks and push more banking activities into more lightly regulated sectors. Under the Fed\u2019s proposals, lenders would be required to hold an extra $2 of capital for every $100 of risk-weighted assets.<\/p>\n<p>\u201cDo [regulators] want banks ever to be investable again?\u201d Dimon said at an industry conference organised by Barclays. <\/p>\n<p>\u201cI wouldn\u2019t be a big buyer of banks\u2009.\u2009.\u2009.\u2009I\u2019d be no better than equal weight, or whatever you call it,\u201d he told the audience of analysts and investors. <\/p>\n<p>Goldman Sachs chief executive David Solomon has also argued that \u201cthese new capital rules have gone too far\u201d.<\/p>\n<p>\u201cThey will hurt economic growth without materially enhancing safety and soundness,\u201d Solomon told CNBC last week.<\/p>\n<p>Alastair Borthwick, Bank of America chief financial officer, added to the criticism on Monday, saying the Fed\u2019s proposals could mean risk-weighted assets are double counted in some instances, which could again constrain bank lending.<\/p>\n<p>\u201cI think there\u2019s going to be some important points of advocacy on the part of industry and by businesses in America, who are the ones who ultimately are going to pay for this,\u201d Borthwick told the Barclays conference.<\/p>\n<p>The US, which has a history of putting its own adjustments on international banking standards, has lagged behind most jurisdictions that have completed the Basel reforms for their banks.<\/p>\n<p>Dimon said the US plan as written would mean JPMorgan would have to hold 30 per cent more capital than a European bank.<\/p>\n<p>The Fed is now soliciting comments on the proposed changes in a notice of proposed rulemaking (NPR) but Dimon was sceptical that any material changes would be made.<\/p>\n<p>\u201cDo you think the NPRs are going to make a shit of difference?\u201d Dimon said, in his characteristically blunt style. \u201cIt\u2019s my academics arguing with their academics. They\u2019re going to do what they want anyway. That\u2019s all that\u2019s going to happen.\u201d<\/p>\n<p>Two Fed governors have come out against certain aspects of the proposals, warning they would hinder competition and financial markets, among other unintended consequences.<\/p>\n<p>\u201cI am concerned that today\u2019s Basel III proposal will increase the cost of credit and impede market functioning without clear benefits to the resiliency of the financial system,\u201d said Christopher Waller in a late July dissent from the rule proposals, which ultimately garnered sufficient approval to proceed.<\/p>\n<p>Fed chair Jay Powell supported the proposals. However, he alluded in July to the need to balance the benefits associated with higher capital requirements against the costs, saying that could be achieved with \u201cpublic input and thoughtful deliberation\u201d.<\/p>\n<\/div>\n<p>Read the full article <a href=\"https:\/\/www.ft.com\/content\/ccd0f68c-2543-4e02-bbbc-0101d04609e1\" target=\"_blank\" rel=\"noopener\">here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Receive free US financial regulation updates We\u2019ll send you a myFT Daily Digest email rounding up the latest US financial regulation news every morning. JPMorgan Chase chief executive Jamie Dimon criticised US regulators over recent proposals for new capital rules, warning they risked making bank stocks uninvestable and would result in borrowers having to pay [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":10322,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","footnotes":""},"categories":[23],"tags":[],"class_list":{"0":"post-10321","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business"},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v21.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Jamie Dimon warns investors over bank stocks if US capital rules enacted | Prosfunds<\/title>\n<meta name=\"description\" content=\"Receive free US financial regulation updatesWe\u2019ll send you a myFT Daily Digest email rounding up the latest US financial regulation 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