This is pretty funny. Bloomberg reports that the Federal Reserve is re-calculating the amount of capital banks must have as they repay TARP funds. The idea is that if banks scrape together all of their money to pay the feds back there might not be any money left over to, you know, actually lend people. And that would look bad.
Hence the Fed has told some institutions to go ahead and raise more capital, just to be safe.
Update: Much interesting info in the latest Institutional Risk Analyst, including the notion that the new capital dings represent the Fed Board in DC trying to claw back power from the New York Fed Bank.
