Lucas Questions Reduced Liquidity in the Treasury Market

<figure class="wp-block-table"><table class="has-fixed-layout"><tbody><tr><td class="has-text-align-left"><strong>Washington, DC – </strong>Today, the House Financial Services Committee held a <a href="https://financialservices.house.gov/calendar/eventsingle.aspx?EventID=410912" rel="noreferrer noopener" target="_blank">hearing</a> entitled, “Oversight of Prudential Regulators”.<br /><br />Congressman Frank D. Lucas questioned Vice Chair Mikki Bowman about reduced liquidity in the Treasury market, and if she expects to increase capital levels.</td></tr></tbody></table></figure>

<figure class="wp-block-table"><table class="has-fixed-layout"><tbody><tr><td class="has-text-align-left"><strong><u>SELECTED REMARKS:</u></strong><br /><br /><strong>Lucas</strong>: &#8220;The government shutdown, quantitative tightening, and reluctance to use the Fed’s Standing Repo Facility have raised concerns about reduced liquidity in the Treasury market. Vice Chair Bowman, as you finalize the Basel endgame proposal how will you keep in mind the implications of capital requirements on Treasury market liquidity and functioning – given the Fed’s report that the banking system is well capitalized, <strong>do you expect to increase capital levels?</strong>&#8220;<br /><br /><strong>Bowman</strong>: &#8220;We&#8217;re currently in the process of reviewing the capital framework by looking at all four of the pillars of capital, including the SLR which we just finalized&#8230;<strong> It&#8217;s critically important that all of the work that we&#8217;re doing does not result in impairing the ability of the banks and of the economy to support the Treasury market and its functioning</strong> so we are certainly attune to any risks that might be presented by the calibration of those proposals.&#8221;</td></tr></tbody></table></figure>

<figure class="wp-block-image size-large"><a href="https://www.youtube.com/watch?v=wlKEAZhPE7s"><img alt="" class="wp-image-5444" height="558" src="https://d12t4t5x3vyizu.cloudfront.net/lucas.house.gov/uploads/2025/12/IMG_009580-1024x558.jpg" width="1024" /></a></figure>

<p>You can watch his full remarks by clicking&nbsp;<a href="https://urldefense.com/v3/__https://www.youtube.com/watch?v=wlKEAZhPE7s__;!!BSgrhSFG!HvMgc_ynQqz-FRkz7kwAgt6HjpN9dZH-NRHRsql8jKKWVLCDBs3ql6c3gR1l27ErvJMCYUlOx_PPklst61ccxzQ4qfO3RtF04fC9DfBb3AXVS9Eh3bFq-54U$" rel="noreferrer noopener" target="_blank">here</a>&nbsp;or on the image above.</p>

<p></p>

<p>###</p>
<p>The post <a href="https://lucas.house.gov/posts/lucas-questions-reduced-liquidity-in-the-treasury-market">Lucas Questions Reduced Liquidity in the Treasury Market</a> appeared first on <a href="https://lucas.house.gov">Frank Lucas</a>.</p>