Fed's Barr Says Extending Enhanced Capital Standards To Banks With $100B In Assets, Down From $700B Threshold
Portfolio Pulse from Happy Mohamed
The Federal Reserve's Barr has proposed extending enhanced capital standards to banks with $100B in assets, a significant decrease from the previous $700B threshold, according to the Wall Street Journal.
July 10, 2023 | 2:18 pm
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NEGATIVE IMPACT
The SPDR S&P Bank ETF (KBE) could be impacted by the Fed's proposal to lower the threshold for enhanced capital standards.
The proposed change in capital standards could potentially increase the regulatory burden on banks included in the KBE ETF, which may negatively impact their profitability and thus the ETF's performance.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80
NEGATIVE IMPACT
The SPDR S&P Regional Banking ETF (KRE) could be affected by the Fed's proposal to lower the threshold for enhanced capital standards.
The proposed change in capital standards could potentially increase the regulatory burden on regional banks included in the KRE ETF, which may negatively impact their profitability and thus the ETF's performance.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80
NEGATIVE IMPACT
The SPDR S&P 500 ETF (SPY) could see some impact from the Fed's proposal, given its exposure to the banking sector.
The proposed change in capital standards could potentially increase the regulatory burden on banks, some of which are included in the SPY ETF. This may negatively impact the ETF's performance, although the effect may be diluted due to SPY's broad market exposure.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 60
NEGATIVE IMPACT
The Financial Select Sector SPDR Fund (XLF) could be impacted by the Fed's proposal to lower the threshold for enhanced capital standards.
The proposed change in capital standards could potentially increase the regulatory burden on financial institutions included in the XLF ETF, which may negatively impact their profitability and thus the ETF's performance.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80