Overseas banks face tighter capital requirements in the United States when the Federal Reserve announces new rules that will increase the cost of doing business in the country, Shanghai Daily reported Monday. The Fed, which meets tomorrow, will require foreign banks to hold as much capital as their US counterparts, the report said. The new regulations are designed to address concerns that US taxpayers will end up footing the bill if European and Asian regulators give US subsidiaries of foreign banks low priority in any bailout. Foreign banks with sizeable operations on Wall Street such as Deutsche Bank and Barclays have pushed back hard against the plan because it means they will need to transfer costly capital from Europe, the report said.
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