The Federal Reserve will hold a meeting at the end of the month to discuss easing bank leverage requirements, marking the start of regulatory relaxation in the banking industry

Reuters Washington, June 17 - The Federal Reserve will consider plans to ease leverage requirements for large banks at a meeting later this month, marking the beginning of a comprehensive review of banking regulations.

The Federal Reserve announced that it will hold a board meeting on June 25 to discuss revising the so-called "supplementary leverage ratio," which pertains to capital reserve requirements for bank assets, regardless of their risk levels.

This meeting will be the first since Federal Reserve Governor Bowman was confirmed as the Fed's top regulatory official. Bowman has developed an ambitious plan to adjust the Fed's oversight and monitoring of the largest and most complex domestic banks, and this move may initiate a series of regulatory rollbacks by the Fed.

The Federal Reserve did not provide specific details on the proposals under consideration, but bankers have been calling for revisions to the supplementary leverage ratio for years, potentially through exemptions for traditional safe assets or modifications to the calculation formula.

Industry insiders believe that the original intent of the requirement was to serve as a benchmark, requiring banks to hold capital reserves even for very safe asset holdings. However, over time, this requirement has gradually evolved into a constraint on lending, effectively limiting banks' ability to adjust to the government bond market during times of stress