Merry Christmas, Wall Street, here's your lump of coal.
The Federal Reserve could announce its acceptance of regulations laid out in Basel, Switzerland, as early as this week, says the Wall Street Journal.
Of course, we know that this means higher capital requirements for banks across the board — something that people on Wall Street have been very vocal about opposing (see: Jamie Dimon, remember when he flipped out about a 3% surcharge on big banks?).
The official numbers for each regulation won't be phased in until 2016, so though insider have a close idea, we're still not completely sure what those numbers will be. That said, it looks like the capital requirements won't get as high Dimon's feared 3%, though big banks that handle a lot of short-term transactions will still get hit with higher capital requirements than anyone else.
JPMorgan and Citigroup, specifically, will have to hold the most — 2.5% of extra capital as a percentage of risk-weighted assets, on top of the 7% base that all institutions will be required to hold, says the WSJ.
Here's the rundown of how everyone else will (likely) fair:
- Bank of America could see a 2% charge.
- Morgan Stanley could see a 1%-1.5% charge.
- Goldman Sachs could see a 1%-1.5% charge.
- Wells Fargo could see a 1% charge.
Dodd-Frank legislation says that these new rules cover any institution that is "systemically important' to the U.S. economy (that means it holds $50 billion or more in assets) . So that means that U.S. companies could get pulled into this regulation next year. Think big companies: GE, Prudential , BlackRock , and AIG .
Again, we won't know exact numbers until the Fed releases them in the coming days (or, perhaps after the holidays — they're way ahead of schedule as is, since these rules weren't supposed be ready until summer 2012).
One thing is certain though, today is one of those days where the little guys are happy they're not big (via the WSJ):
"Nice to be us," said a top executive at one major U.S. bank that isn't expected to share the top category with J.P. Morgan Chase. "I would prefer to be at the kids' table."
This story originally appeared on Business Insider
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