The Securities and Exchange Commission, responding to the collapse of Bear Stearns Cos., may require Wall Street banks to keep more cash on hand during periods of market stress.

The SEC is meeting with investment banks that have lost money on mortgage holdings to discuss raising capital, the chairman of the SEC, Christopher Cox, wrote in letter dated April 16 to Senator Grassley, obtained by Bloomberg News. The agency is also reviewing whether securities firms should seek new loans to support their “less-liquid positions,” Mr. Cox said.

“A likely outcome of this process will be the articulation of additional supervisory expectations related to liquidity,” Mr. Cox wrote to Mr. Grassley, a Republican from Iowa who is reviewing Bear Stearns’ forced sale to JPMorgan Chase & Co.

The SEC is focused on “requirements that will increase resiliency” when investment banks can’t easily secure funding, Mr. Cox said. Any change may crimp Wall Street profits, because firms would have to hold more cash and low-yielding securities instead of lending money or making investments.

The SEC monitors Bear Stearns, Goldman Sachs Group Inc., Lehman Brothers Holdings Inc., Merrill Lynch & Co., and Morgan Stanley to make sure they have adequate capital and liquidity.

The agency currently requires that those firms have enough funding to meet expected obligations for at least one year during periods of market turmoil, according to the agency’s Web site.