ABA has delivered its fifth white paper to the Department of the Treasury outlining the reasons why the Volcker Rule is a drag on the U.S. economy. The rule requires all banks, regardless of size, to refrain from doing any activities that involve “proprietary trading.”
“One of the problems is that, as worded, the Volcker rule applies to all banks, not just the large, systemically important banks,” OBA President and CEO Roger Beverage said. “We join with the ABA that has recommended that the rule be repealed in its entirety. No one knows for sure what it means, and which activities are permissible. In particular, the regulators need to make it clear that it does not apply to traditional community banks.”
“Rather than solving problems, the Volcker Rule has created problems,” the ABA said in the white paper. “It has operated to impede the efficient operation of the financial system, drive banks away from providing services valued by their customers, reduce competition in affected markets and overall act as a drag on the economy.”
Click here to read the white paper.