Fed Prepares New Way to Tailor Rules for Big Banks

From: Wall Street Journal

Regulator is considering dividing banks into categories based on risk factors, including international activity and off-balance-sheet exposures

By Ryan Tracy

WASHINGTON—The Federal Reserve is set to propose a new way of deciding which large banks get hit with its toughest regulations, according to people familiar with the matter.

The expected plan may lower regulatory costs for regional U.S. lenders under the $700 billion asset line, from Discover Financial Services Inc. at around $100 billion in assets to U.S. Bancorp with its roughly $460 billion. The changes under consideration appear to be less beneficial to the very largest U.S. banks considered “systemically important” to the global financial system, such as Bank of America Corp. or Citigroup Inc.

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