Volcker Rule Changes Adopted, Lifting Certain Compliance Burdens for Covered Funds

Morgan Lewis - All Things FinReg

Morgan Lewis - All Things FinReg

The US federal financial regulatory agencies with responsibility for implementing and enforcing Section 13 of the Bank Holding Company Act, commonly known as the Volcker Rule, have finalized amendments to the “covered fund” and “foreign excluded fund” provisions of the rule. The changes will be effective October 1, 2020. Among other things, these final amendments will:

(i)  permanently exempt qualifying foreign excluded funds from being treated as “banking entities” subject to the Volcker Rule proprietary trading and covered fund investment restrictions;

(ii)  establish certain limited exceptions to the “Super 23A” prohibitions, which will allow banking entities to enter into certain types of low-risk transactions with a sponsored or advised covered fund;

(iii)  simplify and relax certain of the conditions and restrictions associated with several covered fund exclusions, including those for foreign public funds and loan securitizations; and

(iv)  establish new covered fund exemptions for certain categories of funds, including credit funds, venture capital funds, and family wealth management vehicles.

Collectively, the changes to the Volcker Rule regulations just adopted by the agencies will result in a meaningful lessening of the Volcker Rule restrictions governing sponsorship and investments in covered funds.

We are in the process of reviewing the final rule and will be publishing a detailed LawFlash in the coming days.

[View source.]

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.

© Morgan Lewis - All Things FinReg | Attorney Advertising

Written by:

Morgan Lewis - All Things FinReg

Morgan Lewis - All Things FinReg on:

Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
- hide
- hide

This website uses cookies to improve user experience, track anonymous site usage, store authorization tokens and permit sharing on social media networks. By continuing to browse this website you accept the use of cookies. Click here to read more about how we use cookies.