in effect
This is a final rule jointly issued by three federal banking regulators — the OCC, Federal Reserve, and FDIC — that adjusts the minimum capital cushion the largest U.S. banks must hold relative to their total assets. Specifically, it loosens a special, stricter version of a leverage capital requirement that applies only to the biggest, most systemically important banks.
The rule replaces the existing fixed leverage buffer for Global Systemically Important Bank Holding Companies (GSIBs) — previously a flat 2% above the 3% baseline — with a variable buffer equal to 50% of each bank’s individual systemic-risk surcharge score, which will be lower for most banks than the old flat 2%. For the banks’ subsidiary depository institutions (the actual bank entities, not just the holding company), the old rule required maintaining a 6% supplementary leverage ratio to be considered “well capitalized”; the new rule replaces that with the same variable buffer formula (50% of the parent’s surcharge), capped at 1%, on top of the 3% baseline minimum — generally a lower bar than 6%. The Federal Reserve is also adjusting its related Total Loss-Absorbing Capacity and long-term debt requirements to match the new leverage figures. The rule takes full effect April 1, 2026, but banks may voluntarily apply it early starting January 1, 2026.
The rule directly applies to U.S. Global Systemically Important Bank Holding Companies (the largest U.S. banks, currently eight institutions including JPMorgan Chase, Bank of America, and similar firms), their federally regulated bank subsidiaries, and any national bank or federal savings association whose parent holds more than $700 billion in assets or more than $10 trillion in assets under custody. Ordinary bank customers and smaller community banks are not directly subject to the rule, though they may be indirectly affected by changes in large banks’ willingness to participate in markets such as U.S. Treasury securities trading.