FILE PHOTO: The Federal Reserve building is pictured in Washington, DC, U.S., August 22, 2018. REUTERS/Chris Wattie
March 5, 2019
By Michelle Price and Pete Schroeder
WASHINGTON (Reuters) – The U.S. Federal Reserve is considering imposing stricter rules on foreign bank branches to tighten what critics say is a loophole that has allowed overseas lenders to shield assets from the toughest U.S. bank rules, three people with knowledge of the matter told Reuters.
The changes being discussed could be a blow for lenders such as Deutsche Bank, Credit Suisse Group AG and UBS Group AG and which have for years held billions of dollars in assets, such as corporate loans, at their New York branches.
The possible rule changes, that have not yet been decided, could also inflame tensions with European regulators who have long-complained that their lenders are held to higher standards in the United States than domestic rivals.
The changes are being considered as part of a broader package tweaking rules for overseas lenders due to be unveiled by the Fed in coming weeks, the people said. Any proposed changes would be subject to industry comment and feedback.
(Reporting by Michelle Price; Editing by Lisa Shumaker)