WASHINGTON – U.S. regulators are considering capital surcharges for large banks based on institutions' sources of funding, Federal Reserve Governor Jerome Powell said on Thursday.
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U.S. regulators are considering ways to prevent banks from growing so large that they could cause a financial crisis if they failed.
"One of the things we're looking at is the short-term wholesale funding aspect of these large institutions," Powell told U.S. lawmakers during a hearing regarding his nomination for another term on the Fed's Board of Governors.
"One of the ways to get at that is through some kind of a capital surcharge based on exposure to short-term wholesale funding," Powell said, adding that no decision had been made.
(Reporting by Washington newsroom and Ann Saphir in San Francisco; Editing by Chizu Nomiyama)