US Fed's Dudley: case to be made for higher SIFI surcharge

NEW YORK Wed May 22, 2013 1:08pm BST

NEW YORK May 22 (Reuters) - 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.

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After wave of QE, onus shifts to leaders to boost economy

DAVOS, Switzerland - Central banks have done their best to rescue the world economy by printing money and politicians must now act fast to enact structural reforms and pro-investment policies to boost growth, central bankers said on Saturday.