A clarification to the Volcker Rule will make it
easier for banks with US operations to maintain foreign public
funds. It came just over a month before the ban on proprietary
trading takes effect.
Staff from the five regulatory agencies overseeing
Volcker issued frequently asked question (FAQ)
14, addressing how much control a bank can have over a foreign
public fund before it becomes subject to Volcker.
The change draws a bright line under what would be
considered control for the purposes of these funds. A bank must
own, or control the power to vote on 25% or more of the funds
securities to be considered a banking entity under the rule.
Sally Miller, CEO of Institute of International Bankers (IIB) said the
update was welcomed by the industry, which had asked for
clarification on this nearly a year and half ago.
"While I would have liked to have had...