In response to significant lobbying from the banking industry, the Federal Reserve plans to revise controversial capital rules known as the Basel III Endgame and the G-SIB surcharge. Fed Vice Chair Michael Barr announced that the proposals will be softened and reissued for public comment, reducing the expected capital hike from approximately 19% to around 9% for major banks, while exempting those with under $250 billion in assets from most new requirements. This shift comes after intense pressure from Wall Street lenders, who argue that increased capital requirements could harm the economy. The revised drafts aim to balance the need for a safer banking system with industry concerns about excessive regulation. Analysts predict further lobbying as the banking sector seeks to influence the final rules. Barr emphasized that the changes reflect feedback received and aim to better align regulatory objectives.