Skip to content
Subscriber Only

Wells Fargo Treated Riskier Than Morgan Stanley Under New Rule

A rule designed to reduce risk in the financial system could end up punishing the wrong banks.

That’s what analysts, economists and some banks say will happen if regulators adopt guidelines proposed last year by the Financial Stability Board, which coordinates banking policy for the biggest economies. The rule, which would require banks to hold a minimum level of long-term debt that can be converted to equity if they fail, benefits lenders with big securities-trading businesses, the kind that led to the 2008 credit crisis.