NEW YORK May 22 A higher capital surcharge may
be required of systemically important financial institutions, or
SIFIs, New York Federal Reserve President William Dudley said.
"One could make the case that an even higher SIFI surcharge
may be appropriate," he said in a Bloomberg TV interview
conducted on Tuesday but aired Wednesday. The international
Basel III agreement requires a 2.5 percent capital surcharge of
risk-weighted assets for the largest financial firms.
But "even if we can't see every piece of risk, or if the
bank's management makes a mistake, there is a lot more capital
buffer available to absorb those shocks and prevent those shocks
from reverberating across the financial system," Dudley added.