The agencies' own description shows why the dispute matters beyond bank compliance departments. One proposal would apply mainly to the largest, most internationally active banks and to banks with significant trading activity. It would implement the final components of the Basel III agreement and change how credit, market and operational risks are captured. A second proposal would generally apply to all but the largest banks and alter standardized risk-weighted assets. A third Federal Reserve proposal would change the global systemically important bank surcharge framework.
Basel III is the international rulebook rebuilt after the 2008 crisis to make banks fund more of their risks with loss-absorbing capital. In this debate, the contested question is not whether banks should hold capital. It is how much capital should be tied to trading positions that large dealers say are hedged, short-lived and essential to keeping public markets liquid.
Table: What the US bank-capital proposals cover
| Proposal | Main scope | Agency description | Disputed pressure point |
|---|---|---|---|
| Basel III endgame rewrite | Largest, internationally active banks and banks with significant trading activity | Streamlines risk-based capital calculations and recalibrates credit, market and operational risk | Trading-book capital for market-making |
| Standardized risk-weighted assets | Generally all but the largest banks | Aligns traditional lending capital with risk and changes some mortgage-servicing treatment | Balance between simplicity and risk sensitivity |
| GSIB surcharge | Largest and most complex banks | Updates how systemic risk is measured for additional capital | Whether surcharge changes alter dealer capacity |
Source: FDIC, Federal Reserve and OCC proposal materials, 2026.
The Financial Times reported that trade bodies including ISDA, SIFMA and the Institute of International Finance were urging regulators to go further, arguing that the proposals still overstate market risk and could affect liquidity in the roughly $29tn US Treasury market. That argument links capital rules to the capacity of large dealers to buy, sell and intermediate government debt, especially when volatility rises.