Investing.com investing.com 22 Dec, 2020 11:45 am

Factbox-Where U.S. banks won and lost in the new pandemic relief package By Reuters

Factbox-Where U.S. banks won and lost in the new pandemic relief package By Reuters
Factbox-Where U.S. banks won and lost in the new pandemic relief package

COMMUNITY BANK LEVERAGE RATIO In 2018, Congress introduced a simple community bank leverage ratio for smaller lenders to reduce their overall capital burden.The law allows regulators to set the required level, based on a leverage ratio, at between 8% and 10%, with regulators opting for 9%, despite community bank protests.Banks say TDR accounting is onerous, sometimes incurring additional capital charges, extra operational hassles and generally acting as a drag on banks' overall asset quality.They say banks should not be penalized for trying to help customers who need temporary relief to keep them afloat until the pandemic passes.

Banks say the rule adds volatility to the amount of capital they must hold and creates incentives to reduce lending when borrowers need it most.Monday's package includes an additional $284 billion for the program and broadens eligible PPP expenses to include items like personal protective equipment for staff and operational costs.

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