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03.02.20

Cleveland Fed researcher provides a brief history of bank capital requirements in the United States

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In this Economic Commentary, Cleveland Fed researcher Joseph Haubrich provides a historical perspective on current discussions of capital requirements by looking at how the understanding of bank capital and the regulations regarding its use have changed over time.

Modern capital requirements can appear to be overly complex. Haubrich finds they reflect centuries of practical experience, compromises between different regulators, and legal and financial systems that developed over time, and that it is quite likely that the long evolution of capital requirements will continue.

Read more: A Brief History of Bank Capital Requirements in the United States

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