Regulators update Congress on financial overhaul

Posted May 13, 2011, at 9:34 p.m.

WASHINGTON — Federal Reserve Chairman Ben Bernanke and other regulators gave Congress an update Thursday on their efforts to implement the biggest overhaul of the nation’s financial rules since the Great Depression.

In testimony to the Senate Banking Committee, Bernanke said the Fed will unveil new regulations this summer that would protect the U.S. economy from another meltdown of the nation’s largest banks and financial companies.

The rules will require big banks and others, such as Wall Street firms, hedge funds and insurance companies, whose failure could endanger the economy, to be subject to more strict requirements for the amount of capital and cash they must have on hand to cushion against potential losses if another financial crisis were to strike.

The Fed will allow the public, banks and other interested parties to comment on the proposed regulations before implementing them in January 2012.