[뉴욕=뉴스핌] Correspondent Kim Min-jung = The Federal Reserve System (Fed) announced on the 19th (local time) that it will end measures to ease the complementary leverage ratio (SLR) at the end of this month as scheduled.
The SLR requires banks to hold more than a certain level of equity capital in the central bank in order to purchase additional assets such as government bonds. In April of last year, the Fed excluded government bonds from this measure.
With SLR easing, the Fed eased the burden on banks amid the pandemic of the novel coronavirus infection (Corona 19) last year. It is to promote the inflow of credit to households and businesses in financial difficulties. There was also the purpose of stabilizing the government bond market due to the pandemic.
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| Jerome Powell Chairman of the Federal Reserve System (Fed).[사진=로이터 뉴스핌] 2021.03.18 [email protected] |
As the measure is not extended, banks will have to increase their equity capital to buy additional government bonds.
In a statement, the Fed explained that “the board will take appropriate steps to ensure that changes in the SLR do not weaken bank capital requirements.”
On Wall Street, concerns have been raised that if the Fed does not extend SLR easing measures, banks will sell Treasury bonds and the recent surge in Treasury yields could rise further.
Instead of extending the SLR mitigation measures, the Fed said it plans to ask public opinion on how it would be desirable to adjust SLR regulations in the future.
The statement explained, “With the recent increase in the supply of central bank holdings and the supply of government bonds, the Fed may need to address the design and measurement of the current SLR.” .
The Fed also stressed that capital requirements for large banks would not decrease.