Federal Reserve chair Jerome Powell said on Tuesday that the Fed needs to ensure all the different pieces of the capital framework work together effectively, as this will help maintain a safe, sound, and efficient banking system.
The official stated that large banks should be well-capitalised and manage their key risks effectively. At the same time, he added, they should be free to compete - with one another, with nonbank financial firms, and with banks in other jurisdictions - to provide capital and support economic growth.
Powell also noted that the Fed is a dynamic institution and is open to hearing new ideas and feedback on how to improve the capital framework for large banks.