ABA Offers Feedback on Proposed S. 2155 Volcker Rule Changes

In a comment letter to the financial regulatory agencies today, the American Bankers Association offered feedback on a recent joint proposal to harmonize the Volcker Rule regulations with the S. 2155 law. ABA commended the agencies for their work to exempt qualifying community banks from the rule entirely, and to allow certain name-sharing arrangements between a covered fund and an investment adviser that is a banking entity. The association also sought clarifications in three specific areas.

First, ABA requested that when determining the community bank exemption the agencies refer only to the most recent regulatory filing to determine the amount of trading assets and liabilities. Regarding the name-sharing provision, ABA urged the agencies to allow a banking entity’s adviser affiliate to use the same or similar name of the covered fund it advises where required or directed under foreign law. ABA also called on the agencies to recognize the self-executing nature of the statutory provisions.

Additionally, as the agencies work to finalize a separate, more comprehensive Volcker reform proposal, ABA urged them not to adopt the proposed accounting test, noting that it is “considerably overbroad.”