A $180 Billion Catalyst for the Biggest Banks & Who Benefits the Most

Some layperson education on bank capital regulations, what happens if capital rules are relaxed, and the winners and losers in that world.

The Racehorses Ready to Run

Picture a thoroughbred, built for speed. Trained, tested, primed to explode out of the gate.

But just before the race, regulators step in. Sandbags on its back. Resistance bands on its legs. A shorter track.

“You’re too powerful,” they say. “We need to slow you down.”

That’s exactly what’s happening to America’s biggest banks. JPMorgan, Wells Fargo, Bank of America, Citigroup, Goldman Sachs, State Street, BNY Mellon, and Morgan Stanley—loaded with excess capital they can’t deploy.

They haven’t stopped them from running. But they’ve kept them from running at full speed.

Now, with a new administration in charge, optimism is rising. The talk? Remove the sandbags. Cut the resistance bands. Let them run.

If the rules are rolled back, expect these banks to surge forward. Even U.S. Bancorp and PNC could join the race.

And when the gate opens?

They won’t jog. They’ll sprint.

The Capital Shackles: A Brief History

Most U.S. bank capital rules were built after 2008 to prevent another meltdown.

• Basel III (2010-2017) set stricter global capital rules.

• The Dodd-Frank Act (2010) introduced CCAR stress tests and higher Tier 1 capital ratios.

• GSIB surcharges (2015) forced the largest banks to hold even more capital.

• The Supplementary Leverage Ratio (SLR) (2014) limited total assets, even safe ones.

• The Stress Capital Buffer (SCB) (2020) added a fluctuating annual requirement.

At the time, these made sense. But the world has changed. GDP and inflation are up 59% since 2015. GSIB scores? Still frozen.

The result? $180 billion in trapped capital.

With new leadership at the Fed, OCC, and FDIC, change is coming. The question is how much and how fast.

Paid members read on for the Money Centers that will benefit the most …