Proposed Bank Capital Rules Threaten US Real Estate Financing, MBA Chief Says
Pedestrians pass by commercial buildings on Park Avenue in New York.
Photographer: Jeenah Moon/BloombergThis article is for subscribers only.
The head of one of the largest mortgage trade groups in the US said proposed rules on bank capital levels have the potential to upend the nation’s entire system of financing real estate.
The proposal, known as Basel III Endgame, would force lenders to thicken the cushions they create to absorb unexpected losses. Regulators initiated the proposed international overhaul in response to the financial crisis of 2008. If approved, the rules would require big banks to increase their capital cushion by almost 20% to ensure they can survive another crunch.