Clifford Chance
Volcker Rule 2.0: Some Helpful Upgrades and Bug Fixes - Update Your Volcker Policies and Procedures Now
October 9, 2019
On October 8, 2019, the Federal Reserve Board approved the interagency final rule adopting amendments to the regulations implementing Section 13 of the Bank Holding Company Act of 1956, commonly known as the "Volcker Rule," that provide some much needed regulatory relief from requirements that have proven to be exceedingly complex, burdensome, and challenging to implement for both the regulators and the banking industry. All other US Federal agencies tasked with promulgating regulations implementing the Volcker Rule, i.e., the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, the Securities and Exchange Commission, and the Commodity Futures Trading Commission, have already approved the Final Rule, and it will become effective on January 1, 2020.
Banking entities subject to the Volcker Rule are not required to comply with the Final Rule until January 1, 2021, however, banking entities may elect to comply, in whole or in part, with the Final Rule prior to the Mandatory Compliance Date, subject to completion of certain technological changes that the Agencies need to implement in order to accept metrics compliant with the Final Rule. As the Final Rule relaxes the regulatory burden of the existing regulations implementing the Volcker Rule, which were promulgated in 2013, banking entities would be well advised to take steps towards complying with the Final Rule as of its effective date, including by revising existing Volcker Rule compliance policies and procedures.
