Morgan Stanley expects the Fed's relaxation of leverage requirements to free up $185 billion in capital

Odaily Planet Daily News Morgan Stanley estimated on Thursday that the Federal Reserve's plan to relax leverage rules could free up $185 billion in capital and unlock nearly $6 trillion in balance sheet capacity. The Federal Reserve on Wednesday announced a proposal to revise the capital requirements of large global banks for relatively low-risk assets to boost participation in the U.S. Treasury market. The Fed voted 5 to 2 to approve the plan, which is the first batch of deregulatory measures that may be introduced under the leadership of Bowman, the Fed's new vice chairman of supervision. The proposal will reform the so-called "enhanced supplementary leverage ratio" so that the amount of capital that banks must set aside is directly linked to their role in the global financial system. (Jinshi)