A 1,100-page proposal by U.S. banking regulators to require lenders to hold more capital on their balance sheets violates the Administrative Procedure Act, seven banking-trade groups said in a joint letter on Tuesday. The government’s proposal, which was approved July 27 by the Federal Deposit Insurance Co., relies on data and analysis that has not been made available to the public, the group said. The proposed rules to bring U.S. banks in compliance with international Basel III guidelines is currently in a public comment period through November. “When proposing a rule, agencies must identify and make available all data and analysis the agencies used to develop the proposal so that the public has a meaningful opportunity to consider and respond to the agencies’ rationale through the public comment process,” the statement said. “The agencies have not done so here.” The trade associations said the government should disclose any and all evidence and analyses they used and then re-propose the rule with a new 120-day comment period. The groups that joined together for the statement include the Bank Policy Institute, the American Bankers Association, the Financial Services Forum, the Institute of International Bankers, the Securities Industry Association, the Financial Markets Association and the U.S. Chamber of Commerce.
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