In the latest Federal Reserve proposal to ease liquidity requirements for all but the largest banks, the second and third tier benefit from not having to carry extra balance sheet as a non-GSIB. These smaller US banks will also have fewer other expenses to contend with. We don’t see the moat around the big banks getting any shallower, but these new proposals will help make the pontoons of the smaller banks a bit bigger.
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US regulation: not a bad time to be BBH, SunTrust or Mizuho (Premium)
