Treasury Secretary Scott Bessent criticized the Federal Reserve and its regulatory rules for big banks. He called for a review of the Fed’s $2.5 billion renovation and non-monetary policy operations, citing mission creep. Bessent suggested deeper reforms for bank regulations and criticized outdated capital requirements. He is a contender to replace Jerome Powell as Fed chair.

Bessent questioned the Fed’s slow interest rate cuts and costs of renovation. He called for a review of the massive building project amid operational losses. President Trump has considered firing Powell over these issues. Bessent expressed support for Fed independence in monetary policy but supported greater White House control over non-monetary operations.

Bessent emphasized the need for regulatory reforms and easier lending for economic growth. US regulators proposed a significant rollback of bank capital rules, altering the leverage ratio. This change could simplify bank capital management and reduce costs. More regulatory changes for big banks are expected, including revisiting capital requirements.

Michelle Bowman, a top banking regulator, hinted at broader capital rollback considerations beyond the leverage ratio change. She emphasized the need for further work on capital requirements to address market conditions. For in-depth analysis of stock market news and financial updates, visit Yahoo Finance’s latest news section.

Read more at Yahoo Finance: Bessent calls for internal review of Fed and ‘deeper reforms’ of big bank rules