Every dollar in capital that is unnecessary for bank safety and soundness limits credit in communities across the country. Basel III is instructive as to how damaging international agreements can be without appropriate congressional scrutiny and public engagement before our regulators go to Switzerland to hammer out these agreements.
Specifically, Keating wrote, Congress should require U.S. regulators to disclose in advance what they are seeking to negotiate in Basel and request public feedback — which can help them better represent America’s thousands of hometown banks at the negotiating table. Keating added:
International agreements can play an important role in strengthening banks. But if we want them to work better, Congress must demand transparency from regulators. Anything less — no matter the good intentions of the Basel crowd — will not pass our democratic test.
Read the op-ed.