I’ll then turn to two additional steps we might consider. On safety and soundness, the Federal Reserve and other agencies received excellent comments from community banks on the Basel III proposal.
These comments led to changes to the proposed rule that reduce unnecessary burdens on smaller banks.3 Smaller banks can opt out from having their capital levels vary due to changes in particularly volatile aspects of income. The final rule also allows smaller institutions to continue to count certain types of stock or securities as capital, when larger banks cannot.