Per Woofun AI, Wall Street financial institutions are urging US regulators to further loosen proposed global bank capital requirements under the Basel Accord. Industry leaders warn that strict adherence to these rules could weaken liquidity in the US Treasury market and urge authorities to reconsider measures intended to control market risk.

Concerns regarding potential instability in the $29 trillion US Treasury market have become a primary lobbying focus for the US banking industry as Washington moves to implement global regulatory frameworks. These rules originate from the international bank risk framework developed following the 2008 financial crisis. While the Federal Reserve and other regulatory agencies have significantly diluted the original proposal under industry pressure—with expectations that overall capital requirements will not dramatically increase and may even decrease—Wall Street firms continue to push for further adjustments. According to a letter from eight large US banks, the latest proposal would still result in a 30% to 89% increase in capital requirements for the sector's banking operations.