The head of the New York Fed expects the implementation of Dodd-Frank in the U.S. and Basel 3 worldwide to constrain the amount of overall leverage a financial-services organization can take relative to the sum of its assets and exposures. Speaking to the Institute of International Finance in Washington Sunday William Dudley, president and chief executive of the Federal Reserve Bank of New York, said the new regulations "represent a very significant upgrade of the standards." This summer, President Obama signed the landmark reform package that's expected to overhaul oversight of the entire mortgage-finance industry, as well as most other banking and financial services. Last month, the Basel Committee on Banking Supervision adopted new standards for the capital requirements of the world's largest financial firms, mandating the banks hold capital equal to 7% of assets among other requirements. Dudley said the risk-based ratios will be back-stopped by the new leverage ratio standard. "A much higher proportion of this ratio is now met by common equity," he said. "That common equity is much better quality than before; the amount of risk-weighted assets against which capital must be held has increased and better reflects underlying risk; a new capital conservation buffer is added, and there is a new backstop against excessive leverage." Dudley also called for increased cooperation between U.S. regulators and those of foreign banks with consistent policies and penalties. "It is also my hope that by establishing a robust global regime, we can mitigate the incentives for national regulators and supervisors to impose local rules that make it hard for globally active institutions to manage their operations on a global basis, thereby undermining the global integration of markets that has supported economic globalization," Dudley said. He expects global regulators to be particularly busy over the next year to 18 months, as "broad legal statutes now have to be turned into specific rules and regulations governing business practices, conduct and operations." Write to Jason Philyaw.