Dodd-Frank and the Regulation of Depository Institutions Capital Requirements

Abstract

This chapter continues the discussion of the previous chapter on the Dodd-Frank Act. In the years since its passage, the legislation has had dramatic effects on the operation and stability of the financial markets, and will continue to play a vital role in the capital markets. In addition to establishing new capital and leverage requirements for banks, bank holding companies, and systemically significant nonbanks, Dodd-Frank also mandates that these requirements be “countercyclical, so that the amount of capital required to be maintained by a company increases in times of economic expansion and decreases in times of economic contraction.” The remainder of the chapter covers the Volcker Rule; living wills, credit exposure reports, and concentration limits; and other prudential standards.