
Congress Flirts with Disaster on Bank Leverage Ratios - antiviral
https://www.wsj.com/articles/congress-flirts-with-disaster-on-bank-leverage-ratios-1518479068
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antiviral
What could possibly go wrong here:

"Because their judgments about risk had been so wrong, regulators after the
financial crisis have made greater use of capital standards that don’t rely on
government risk assumptions. For big banks, the most important of these is the
“supplemental leverage ratio,” which requires big banks to fund themselves
with at least 5% common equity, effectively limiting their reliance on debt to
95%.Section 402 would weaken this modest constraint on leverage by excluding
central-bank deposits from this debt-to-equity ratio."

