U.S. regulators plan to lower the capital buffer requirements for large banks, with a reduction of up to 1.5 percentage points.

On June 18, the major banking regulators in the United States plan to cut key capital buffer requirements for large banks by as much as 1.5 percentage points. Previously, there were concerns in the industry that the current rules were constraining banks' trading activities in the $29 trillion Treasury market.

Sources say that the Federal Reserve, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency are focusing on the so-called Enhanced Supplementary Leverage Ratio (eSLR), which applies to U.S. systemically important banks such as JPMorgan Chase, Goldman Sachs, and Morgan Stanley. The new proposal aims to reduce the capital requirement for bank holding companies under the eSLR from the current 5% to a range of 3.5%-4.5%. The capital requirements for bank subsidiaries are also expected to be lowered from 6% to the same range.

This adjustment is similar to the "customization" revision approach to the eSLR calculation for systemically important banks during the Trump administration in 2018, but the specific terms may still be modified.