Plans to tighten oversight of foreign banks in the United States are crucial for financial security and pose no threat to global banking reform, the Federal Reserve's point person on financial regulation said on Wednesday. Speaking on CNBC-TV, Fed Governor Daniel Tarullo defended a plan to require all foreign banks to group subsidiaries under a holding company, subject to the same capital standards as U.S. holding companies. The biggest banks would also need to hold liquidity buffers. The plan, part of a drive by the world's largest countries to make banking safer after the 2007-09 financial crisis, has drawn criticism from bankers who fear it will cut profits and make it harder for them to compete for U.S. business. "I understand that banks sometimes don't like to have to increase their capital, but that is something we've required of banks in the United States," Tarullo said. He said the curbs on foreign banks were "an effort to respond to the financial vulnerabilities that
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