The resignation of Michael Barr as US Federal Reserve Board vice-chair for supervision is poised to disrupt progress on the Basel III endgame, a critical framework to enhance the resilience of global banking. Barr’s departure on February 28 adds another layer of uncertainty to an already complex process.

As highlighted in Janice Kirkel of Risk.net’s excellent article, disagreements over capital requirements, operational risk metrics, and the leverage ratio have already slowed progress. Now, with leadership transitions at the Fed, OCC, and FDIC, these delays could extend further.

Key Takeaways:

📌 The Fed has paused major rule-makings until a new vice-chair is confirmed.
📌 Michelle Bowman and Christopher Waller, potential successors, are critical of the current proposal. Bowman supports recalibrating market and operational risk rules, while Waller suggests a complete overhaul.
📌 The OCC and FDIC may lead interim efforts, but significant revisions are likely.

For banks and financial institutions, these delays present a dual-edged sword: more time to adapt but ongoing uncertainty that complicates planning.

Challenges include:

• Capital Management: Balancing balance sheets without clarity on future requirements.
• Operational Readiness: Preparing systems and processes for rapid adjustments once rules are finalised.
• Strategic Alignment: Maintaining competitiveness while ensuring compliance amid shifting regulatory demands.

How to Prepare

The Basel III endgame is not just about compliance—it’s an opportunity to build a more resilient financial framework. At SecFin Solutions, we help organisations navigate this complexity and turn challenges into strategic advantages.

Our tailored services include:

• Gap Analysis: Identifying readiness gaps and compliance risks.
• Strategic Roadmapping: Aligning capital structures and operations with evolving regulations.
• Training Programmes: Empowering teams to understand and manage regulatory changes.

With expertise in securities financing, risk management, and regulatory compliance, we can help your organisation not only meet the new standards but position itself for long-term success.

Let’s Talk
The Basel III endgame is a pivotal moment for the financial sector. Firms that prepare now will be best placed to thrive. If you’d like to explore how these changes affect your organisation, let’s connect.

Together, we can turn regulatory uncertainty into opportunity.

SecFin Solutions

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