In remarks that were prepared for a hearing by the House Financial Services Committee today, it was revealed that an interagency group has been formed to coordinate the efforts of the US Federal Reserve, Federal Deposit Insurance Corp. and three other agencies implementing the controversial Volcker Rule.
Securities and Exchange Commission Chairman Mary Jo White had said in her remarks about the newly-formed group, "This interagency group will be instrumental in coordinating the agencies' interpretations and implementation of the final rule on an ongoing basis."
Bloomberg said that White will be joined by Daniel Tarullo, FDIC Chairman Martin Gruenberg, Comptroller of the CurrencyThomas Curry and Mark Wetjen, acting chairman of the Commodity Futures Trading Commission in the new interagency group.
Volcker Rule contains a list of trading restrictions that bans banks from delving into speculative securities. The measures, said Bloomberg, is part of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and was named after former United States Federal Reserve Chairman Paul Volcker.
Gruenberg said in a statement that the formation of an interagency group was needed to provide additional clarity or guidance with regard to the implementation of the Volker Rule.
Bloomberg said the formation of the group was spurred from complaints from lawmakers and industry groups who had difficulty understanding the Rule and the future inconsistencies among the agencies who were responsible for the measure.
Some of the top banks, through their own representatives, had been clamoring for the amendments of the Rule, of which at the moment is limiting the financial institutions to trade in senior debt securities issued by collateralized loan obligations, Bloomberg said.
Chairman Jeb Hensarling of Texas at the first hearing on Volcker Rule said last month that it is not in the government's or in the banks' hands on stemming the effects of the Rule on the US economy. He said, "Banking entities will have to discontinue some activities and investments, but the impact of those changes on the overall market will depend in large measure on factors that neither banking entities nor the agencies control."
