Big banks will need to hold more capital to guard against risk under new Fed proposal

By KEN SWEET
AP Business Writer

NEW YORK (AP) — The nation’s biggest and most complex banks will need to hold additional capital on their balance sheets under an initial proposal by the Federal Reserve designed to help banks better withstand risks to their businesses that go beyond a recession or financial crisis. The proposal released Thursday, boiled down from highly complex and technical nuances, roughly means that Wall Street collectively will have to set aside tens of billions of dollars as a buffer against risk. The banking industry had a hostile reaction to the Fed’s proposal. Banks have long contended that they hold more than enough capital to withstand even a global financial crisis.