By Justin Baer 

Morgan Stanley's finance chief said Tuesday that recent remarks by a Federal Reserve governor over the need to impose stiffer capital rules on the largest U.S. banks were "consistent" with past comments, while noting it still wasn't clear how the new requirements would affect the Wall Street firm and its peers.

Federal Reserve Governor Daniel Tarullo said this week the regulator intends to force the biggest banks to maintain an even bigger cushion against potential losses than the so-called capital surcharges put in place by international bank regulators. Mr. Tarullo also warned that banks' dependence on overnight loans and other forms of wholesale funding would help determine how high they surcharge would be.

"He's been pointing in the direction that there would be some sort of increment included for wholesale funding," Ruth Porat, Morgan Stanley's chief financial officer, said Tuesday at the Barclays Capital Global Financial Services Conference.

Among the biggest U.S. banks, Morgan Stanley trails only Goldman Sachs Group Inc. in its reliance on the various forms of short-term, wholesale funding.

"Our view is that not all wholesale funding is the same," Ms. Porat said.

During her presentation, Ms. Porat argued Morgan Stanley had been early to adapt to the new capital rules, and many of the New York firm's key capital ratios were well above the minimums expected by regulators. As Mr. Tarullo reiterated this week, those requirements will move higher.

"I think it's a bit early to say" where the Fed will set the surcharges, she said. "But we're starting with a strong capital position."

When asked about how Wall Street's trading businesses were faring in the third quarter, Ms. Porat offered a mixed bag. Morgan Stanley and its peers have slogged through an unusually calm period in the markets, limiting client activity and the opportunities for banks to profit from price swings.

"There was a pickup in June that persisted through much of July," Ms. Porat said. "August was very quiet, even for a typical August. So, really, a lot of it hinges on what goes on through September."

Write to Justin Baer at justin.baer@wsj.com

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