Fed turns up heat on dollar repo dodge

New liquidity rules for foreign banks’ US branches may be hard to stop, but can be softened

Sometimes, internal arguments at regulatory agencies spill out into the open. On April 8, the three US prudential regulatory agencies published their proposals on updated rules for foreign banking organisations (FBOs). But Democrat-nominated US Federal Reserve governor Lael Brainard wasn’t happy.

After months of rumours that the proposals would include new regulation covering the liquidity risk of foreign bank branches that sit outside the local intermediate holding company (IHC), the eventual