Bank Capital: What More Do Banks Want In Basel 3 Endgame & Will They Get It?

Research evidence excerpt

Bank Capital: What More Do Banks Want In Basel 3 Endgame & Will They Get It?

TD Securities (USA) LLC POLICY NOTE

June 24, 2026

■WRG Financial Services Bank Capital: What More Do Banks Want In

Basel 3 Endgame & Will They Get It?

Jaret Seiberg THE TD COWEN INSIGHT

202 868 5313

We believe the door is open for improvements to the Basel 3 Endgame capital proposals.

jaret.seiberg@tdsecurities.com

Based on industry comment letters, changes may boost mortgage lending, address concerns

with unconditionally cancelable lines of credit and mitigate the concern that capital for some

secured CRE loans could exceed what is required for unsecured commercial loans. Downside

risk is litigation over single stack.

The comment period on the Basel 3 Endgame capital proposals closed last week.

■This keeps the proposals on track to be finalized by late 2026 or early 2027.

■Endgame is broadly positive for banks.

■We believe the market continues to underappreciate the benefit from the combination of

capital, liquidity and stress testing reforms.

■Regulators appear open to constructive changes, which is why many ideas banks proposed

may be adopted.

■Risk remains litigation if judges conclude the move to single capital calculation from the

current dual stack approach violates the Collins Amendment.

Changes banks want would:

■Fix the definition of unconditionally cancelable for lines of credit to ensure cancelable lines

do not get hit with higher capital charges for banks subject to the Expanded Risk-Based

Approach.

■Retain the current the definition of "commitment" for lines of credit, which is a legally

binding agreement. The proposal would expand that to contractually agreed upon terms to

govern future credit extensions even if the bank retains the right not to originate the loan.