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Federal Deposit Insurance Corporation

Better Markets' Comment Letter on Regulatory Capital Rule-Eligible Retained Income

The agencies' new regulatory capital rule is profoundly misguided under the extraordinary economic circumstances we face today.  It is designed and intended to make it easier for banks to continue making capital distributions in the form of dividends and discretionary bonuses even as their profits plummet, their capital buffers could fall below important thresholds, and enormous uncertainty looms over the future direction of the economy as the COVID-19 pandemic unfolds.  This is precisely the wrong regulatory approach at exactly the wrong time.

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