An amendment offered by Senators Ted Kaufman (D-DE) and Sherrod Brown (D-OH) to the Restoring American Financial Stability Act (S. 3217) has been defeated by a vote of 33 to 61.
According to a press release, it would change the size, leveraging and capital requirement standards of “megabanks” in order to prevent financial institutions from becoming “too big to fail.”
Limits would be placed on banks by:
- Imposing a strict 10% cap on any bank-holding-company’s share of the United States’ total insured deposits.
- Limits the size of non-deposit liabilities at financial institutions (to 2% of United States GDP for banks, and 3% of GDP for non-bank institutions)
- Sets into law a 6% leverage limit for bank holding companies and selected nonbank financial institutions.
In addition, a second-degree amendment offered by Senator John Ensign (R-NV) to this amendment was defeated by a vote of 35 to 59. It would have applied the same restrictions mentioned above to Fannie Mae and Freddie Mac.
(credit images – getty / wordpress)
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