KANSAS CITY, MISSOURI – The Federal Reserve Bank of Kansas City today released the June 30, 2024 results from its semiannual External LinkBank Capital Analysis (BCA)External Link, which provides an objective and data-based approach to judging capital strength across the banking industry. The BCA presents leverage ratios for individual U.S. global systemically important banks (G-SIBS), non-U.S. G-SIBs, and three other groups of institutions in the United States: External Linklarge, regional and community banking organizations.
While banks of all size groups entered the pandemic with stronger capital ratios than prior to the 2007-2008 financial crisis, the trend in leverage ratios at the largest banks had started flattening and even declining in the years leading up to the pandemic. Balance sheet growth stemming from pandemic policy responses put immediate downward pressure on the weighted average tier 1 leverage ratio for all U.S. banking groups, but the trend has reversed with banks across all portfolio groups, except for U.S. G-SIBS, approaching, but still below, pre-pandemic levels.
U.S. G-SIBs’ weighted average tier 1 leverage ratio decreased 12 basis points to 7.12 percent in the first half of this year, ending June 30, 2024, and remains below leverage capital ratios for large (9.46 percent), regional (9.95 percent) and community (10.62 percent) banking organizations. As of June 30, 2024, the weighted average supplementary leverage ratio (SLR), also known as the Basel III leverage ratio, for U.S. G-SIBs decreased 8 basis points since year-end 2023 to 6.00 percent.
As the regional headquarters of the nation’s central bank, the Federal Reserve Bank of
Kansas City and its branches in Denver, Oklahoma City and Omaha serve the seven states of the Tenth Federal Reserve District: Colorado, Kansas, Nebraska, Oklahoma, Wyoming, northern New Mexico and western Missouri.