Financial firms and others will get another month to comment on a major provision of the Dodd-Frank financial overhaul law setting out stricter capital, liquidity and other requirements for the nation's biggest banks.

The Federal Reserve on Friday extended the public comment period for enhanced prudential standards until April 30 from March 31.

The proposed rules would require the biggest U.S. banks to limit their financial ties to one another, with the intent of preventing the collapse of one big institution from triggering a larger, cascading crisis.

The net credit exposures between any two of the nation's six largest financial firms, including J.P. Morgan Chase & Co. (JPM) and Goldman Sachs Group Inc. (GS), would be limited to 10% of a company's regulatory capital, said the proposal that the Fed unveiled to the industry late last year and published in January.

"Due to the range and complexity of the issues addressed in the rulemaking, the Board has determined that an extension...is appropriate," the Fed said in a notice Friday.

In December, analysts said the new 10% limit for the biggest firms was not anticipated by the industry and has the potential to scale back the capital-markets businesses of large institutions. Most other firms covered by the rule would be subject to a 25% limit, as required by the 2010 Dodd-Frank law.

The 2008 financial crisis showed that links among major institutions could destabilize the entire economy, as happened when Lehman Brothers Holdings Inc. filed for Chapter 11 bankruptcy and the U.S. government had to prop up Lehman's rivals.

The stricter rules aim to reduce the ability of any single financial giant to damage the financial system and the broader economy, and is one of several ways Dodd-Frank attempts to end the "too big to fail" phenomenon that led to huge taxpayer-funded bailouts.

Broadly, the rules apply to all banks with at least $50 billion in assets, as well as any nonbank financial firms, such as insurance companies or asset managers, that regulators deem a large enough threat to financial stability.

-By Eric Morath, Dow Jones Newswires; 202 862 9279; eric.morath@dowjones.com

--Victoria McGrane and Dan Fitzpatrick contributed to this article.

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