Latest news with #liquidity
Bloomberg
an hour ago
- Business
- Bloomberg
Fed Is Right to Wait on Rates, Says Hoenig
Former Kansas City Fed President Thomas Hoenig says the Federal Reserve is right keep interest rates where they are because there is so much uncertainty and there's plenty of liquidity in the market. He speaks on "Bloomberg Surveillance." (Source: Bloomberg)
Bloomberg
4 hours ago
- Business
- Bloomberg
Banks Offer Higher Rates on Deposits as BOE Drains Liquidity
UK banks are offering unusually high interest rates to clients in order to attract cash, the latest sign of how the Bank of England's balance-sheet reduction is shrinking liquidity in the system. The rate offered by banks most keen to attract overnight deposits has aligned with the BOE's key rate for the first time since May 2020, excluding a brief up-tick over year-end, according to Sterling Overnight Index Average (SONIA) data published Friday. The reading represents the amount banks pay to borrow sterling from other financial institutions.
Yahoo
19 hours ago
- Business
- Yahoo
US Regulators Mull Easing Banks' Capital Rule on Treasury Trades
In a move aimed at enhancing liquidity in the $29 trillion U.S. Treasury market, U.S. regulators are planning to ease a key capital requirement that has long constrained large banks' trading activity. The Federal Reserve, Federal Deposit Insurance Corporation, and Office of the Comptroller of the Currency are reportedly considering a proposal to lower the enhanced supplementary leverage ratio (SLR) by up to 1.5 percentage points for the largest U.S. banks, including JPMorgan Chase JPM, Goldman Sachs GS, Morgan Stanley MS, and Wells Fargo WFC. Currently, all U.S. banks are obligated to hold capital equal to at least 3% of their total exposures, including assets and off-balance sheet items like derivatives. The largest global banks are required to maintain an additional 2%, bringing their minimum leverage ratio to 5%. The proposal would reduce the capital requirement under the SLR for bank holding companies from 5% to a range of 3.5% to 4.5%, while subsidiaries could see their threshold drop from 6% to the same range. Fed Chair Jerome Powell has raised concerns that strict capital rules may limit banks from holding Treasuries, particularly during times of volatility. Under the current framework, Treasuries are treated in the same category as higher-risk assets, which can reduce incentives for banks to trade or hold them. Michelle Bowman, the Fed's vice chair for supervision, earlier this month, stated that leverage rules are meant to support capital strength. However, when these ratios are set too high, they may limit market activity and reduce liquidity. A proposed easing of these capital requirements could benefit major banks such as JPMorgan Chase, Goldman Sachs, Morgan Stanley, and Wells Fargo by reducing the amount of capital they must hold in reserve. This would give them more flexibility to expand operations, particularly in lending and Treasury trading. In addition, lower capital buffers could enhance bank profitability by freeing up funds for investment and business growth. However, the overall effectiveness of the changes will depend on how banks respond and whether regulators introduce further reforms. Currently, JPMorgan, Morgan Stanley, and Wells Fargo carry a Zacks Rank #3 (Hold), while Goldman Sachs has a Zacks Rank #4 (Sell). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Goldman Sachs Group, Inc. (GS) : Free Stock Analysis Report Wells Fargo & Company (WFC) : Free Stock Analysis Report JPMorgan Chase & Co. (JPM) : Free Stock Analysis Report Morgan Stanley (MS) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Globe and Mail
21 hours ago
- Business
- Globe and Mail
US Regulators Mull Easing Banks' Capital Rule on Treasury Trades
In a move aimed at enhancing liquidity in the $29 trillion U.S. Treasury market, U.S. regulators are planning to ease a key capital requirement that has long constrained large banks' trading activity. The Federal Reserve, Federal Deposit Insurance Corporation, and Office of the Comptroller of the Currency are reportedly considering a proposal to lower the enhanced supplementary leverage ratio (SLR) by up to 1.5 percentage points for the largest U.S. banks, including JPMorgan Chase JPM, Goldman Sachs GS, Morgan Stanley MS, and Wells Fargo WFC. Details of the Proposed Capital Rule Adjustment for Banks Currently, all U.S. banks are obligated to hold capital equal to at least 3% of their total exposures, including assets and off-balance sheet items like derivatives. The largest global banks are required to maintain an additional 2%, bringing their minimum leverage ratio to 5%. The proposal would reduce the capital requirement under the SLR for bank holding companies from 5% to a range of 3.5% to 4.5%, while subsidiaries could see their threshold drop from 6% to the same range. How Easing Capital Rule Impact Banks? Fed Chair Jerome Powell has raised concerns that strict capital rules may limit banks from holding Treasuries, particularly during times of volatility. Under the current framework, Treasuries are treated in the same category as higher-risk assets, which can reduce incentives for banks to trade or hold them. Michelle Bowman, the Fed's vice chair for supervision, earlier this month, stated that leverage rules are meant to support capital strength. However, when these ratios are set too high, they may limit market activity and reduce liquidity. A proposed easing of these capital requirements could benefit major banks such as JPMorgan Chase, Goldman Sachs, Morgan Stanley, and Wells Fargo by reducing the amount of capital they must hold in reserve. This would give them more flexibility to expand operations, particularly in lending and Treasury trading. In addition, lower capital buffers could enhance bank profitability by freeing up funds for investment and business growth. However, the overall effectiveness of the changes will depend on how banks respond and whether regulators introduce further reforms. Currently, JPMorgan, Morgan Stanley, and Wells Fargo carry a Zacks Rank #3 (Hold), while Goldman Sachs has a Zacks Rank #4 (Sell). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Only $1 to See All Zacks' Buys and Sells We're not kidding. Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent. Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators, and more, that closed 256 positions with double- and triple-digit gains in 2024 alone. See Stocks Now >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Goldman Sachs Group, Inc. (GS): Free Stock Analysis Report Wells Fargo & Company (WFC): Free Stock Analysis Report JPMorgan Chase & Co. (JPM): Free Stock Analysis Report Morgan Stanley (MS): Free Stock Analysis Report
Yahoo
a day ago
- Business
- Yahoo
Kraken-Backed Ink Foundation to Airdrop INK Token, Starting With Aave-Powered Liquidity Protocol
The Ink Foundation, the nonprofit behind layer 2 Ink, is launching its native token INK in an attempt to bootstrap onchain capital markets through a liquidity-first strategy. The token will debut on a decentralized finance (DeFi) lending and trading protocol built on Aave, and distribution will begin via an airdrop to early users. There will be no governance gimmicks or fluctuating emissions schedules, the foundation said. INK has a hard cap of 1 billion tokens minted, with no recourse to change the supply via governance proposals. And unlike other Superchain members, Ink says its layer 2 governance will remain separate from the token. (A Superchain is a group of layer-2 networks built using the same software, allowing them to share security, upgrades, and tools. Think of it as different cities on the same highway system.) The first utility is a liquidity protocol native to the Ink chain, designed as a core DeFi primitive for lending and capital deployment. Participants in the protocol will be eligible for INK airdrops, with further specifics still to come. Distribution will be handled by a subsidiary of the foundation, which claims to have methods to curb airdrop farming. However, INK enters a crowded market where most new tokens, even those with venture backing and protocol traction, tend to trend downward after launch. Linea, Blast, Celestia, Berachain, and other high-profile projects, all launched L2 tokens in 2024–25 with major fanfare — only to face sustained sell pressure. Many critics now see token launches less as aligned economic tools and more as delayed exit liquidity events. INK will debut in a cycle where most tokens are in decline, retail attention is light, and capital rotation is highly selective. Ink's DeFi stack holds just over $7 million in total value locked, with only $93 in L2 revenue reported over the past 24 hours, according to DefiLlama data, indicating that real usage remains relatively thin. Still, by anchoring its token to a functioning product on day one — via Aave governance and integration — Ink is at least attempting to buck the trend of poor launches.
