Final regulations under the section of the Dodd-Frank Act known as the “Volcker Rule” were enacted in December 2013 (the “Final Rule”) by five federal financial regulatory agencies (collectively, the “Agencies”). The Volcker Rule prohibits a banking entity from engaging in proprietary trading and from acquiring or retaining an ownership interest in, or sponsoring, a hedge fund or private equity fund. The Volcker Rule permits certain kinds of trading activity – notably, in connection with underwriting, market making, and risk-mitigating hedging activities – and the Final Rule addresses the parameters of and possible conditions on these activities.

Under the Final Rule, larger banks and bank affiliates (based on total assets) engaged in proprietary trading permitted by the Final Rule will be subject to a comprehensive regime to ensure compliance with the Final Rule’s prohibition on proprietary trading. In addition, the largest banks and bank affiliates (based on the amount of trading assets and liabilities) engaged in proprietary trading permitted by the Final Rule will be required to report a highly technical set of quantitative measures. Banking entities with only a “modest” level of trading activities will be subject to a much less comprehensive set of compliance requirements, and those entities participating in no covered activities will have no obligation under the Final Rule.

Please see full Article below for more information.

LOADING PDF: If there are any problems, click here to download the file.

Written by:

Published In:

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Morrison & Foerster LLP | Attorney Advertising

Don't miss a thing! Build a custom news brief:

Read fresh new writing on compliance, cybersecurity, Dodd-Frank, whistleblowers, social media, hiring & firing, patent reform, the NLRB, Obamacare, the SEC…

…or whatever matters the most to you. Follow authors, firms, and topics on JD Supra.

Create your news brief now - it's free and easy »

All the intelligence you need, in one easy email:

Great! Your first step to building an email digest of JD Supra authors and topics. Log in with LinkedIn so we can start sending your digest...

Sign up for your custom alerts now, using LinkedIn ›

* With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name.
×
Loading...
×