The Federal Reserve's Vice Chair for Supervision, Michael Barr, announced significant revisions to the proposed Basel III capital requirements for large banks, scaling back an intended 19% increase to just 9% in response to intense lobbying from Wall Street. This revision exempts medium-sized banks from the new requirements, while only slightly increasing capital requirements for smaller banks. The changes aim to mitigate potential financial crises but have raised concerns about the adequacy of capital reserves to prevent bank runs. Barr stated that the Fed has consulted various stakeholders, leading to the conclusion that broad adjustments to the proposals are necessary. The revised proposal will undergo further public feedback before final rulemaking, indicating potential for more lobbying and modifications ahead.