U.S. Senator Sherrod Brown said he and Senator David Vitter are working on a bipartisan bill to force big banks to set aside even more capital than currently required to assure they won’t need government bailouts.
The Ohio Democrat and Louisiana Republican have been working in tandem to keep the biggest banks -- such asJPMorgan Chase & Co. (JPM) and Bank of America Corp. (BAC), whose assets exceed $2 trillion each -- from benefitting from the perception that they’re too big to fail.
“In the largest Wall Street banks, neither the quantity nor the quality of their capital is good enough, is adequate enough to protect the public against too big to fail,” Brown said in an interview with Bloomberg Television’s Peter Cook for “Capitol Gains” airing March 10. “We’ve seen people across the board of the ideological spectrum who realize that this is a serious problem.”
Brown and Vitter, both on the Senate Banking Committee, would boost capital levels higher than those agreed to by the Basel Committee on Banking Supervision in 2010. Brown, who is chairman of a subcommittee overseeing financial firms, also plans to reintroduce a bill he failed to get included in the 2010 Dodd-Frank Act or passed in the last Congress that would cap bank size and limit non-deposit liabilities.
He said the big banks have “insulated themselves in a way that’s given them more economic power in the marketplace and more political power in Washington.”
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